At Mobile World Congress this year, digital entertainment specialist Rovi announced a partnership with Dixons Retail that would see the British company use its technology to power an "over the top movie service" called KNOWHOW Movies.
This is the first time a UK brand has used Rovi Entertainment Store, a white-label product, to give consumers access to films and TV shows via a digital store.
But Rovi has fingers in many pies, from entertainment discovery, to distribution and advertising.
We sat down with David Jordan, Rovi's VP of Marketing to talk about developments in this space, the opportunity for marketers and what it means for consumers.
Everyone's talking about the now very real potential of two-screen and media stacking (whichever buzzword you want to use), but what's your take on it? Where does Rovi fit in?
We see tremendous potential in the second screen for delivering a highly personalised and dynamic consumer entertainment experience.
We're already serving this market today through our white label product TotalGuide xD, which service providers Bend Broadband (in Bend, Oregon) and Armstrong (in Pennsylvania) are rolling out in the US. The product will be branded by the service providers and deliver a companion discovery experience to their subscribers.
This means that the application (an iPad app at first, but could be tailored for Android tablets and phones) will provide information about broadcast television. This includes times and channels that shows are on, a more in depth discovery experience with pictures, biographies of actors, descriptions of shows, and recommendations based on basic information like similar shows. Then there are more personalised recommendations based on a subscriber's favourite actors or genres. It also provides the ability to remotely manage the set-top box for things like changing the channel or setting recordings for a DVR from a remote location. Plus, it displays targeted advertising to drive additional revenue.
This basically connects and extends the experience you get from set-top boxes to multiple mobile screens, including tablets and smart phones. It allows people to control (set a recording, channel tune, etc) and enhance their living room experience by easily searching and discovering meaningful content from a range of the sources.
Trends are likely to be based on the time and place for using the second screen. For example, it may be a companion when used at the same time as watching a broadcast or VOD (video on demand) programme on a larger screen in the home; or the second screen may be used for the viewing device depending on the location, such as at the gym or on a train; or it may be a "controller" to set a remote recording or to use as a remote control. The trend is to watch the content on the best screen available, and use the smaller screens as companions, controllers or viewing devices when it makes sense.
Similarly, in Japan, we offer G-Guide EPG for iPad, which is a direct to consumer offering that provides an in-depth view into Japanese TV programme information. People see the time and channel grid, and can also access detailed information about the shows. It is similar to TotalGuide xD in the US, as outlined above, but is branded as G-Guide (a brand that gets its technology from Rovi and its distribution from IPG) in Japan. Informed by social networks and individual preferences, these applications for the second screen give consumers a personal and streamlined view into the entertainment they love without disrupting the "main screen" entertainment (or disturbing that experience for others).
Based on personal preferences or higher level market info, personalised entertainment platforms can be utilised by brands and marketers to deliver enhanced and relevant advertising to consumers.
What about monetising this?
One way to monetise this second screen experience is through advertising.
For example, there are several technologies that connect the second screen to the primary screen for advertising purposes.
This could leverage something like audio recognition during an auto commercial to direct your mobile device right to a website that lets you configure your favourite car model on a tablet based on an advert that is playing on the large screen.
Or maybe it's a sponsorship opportunity, where for example someone is watching a cooking TV show that is sponsored by a condiment like Heinz Ketchup; in this case a mobile device (second screen) might be used to deliver a recipe that uses the condiment.
I'd then have easy access to my shopping list when I go to the supermarket and will remember to buy the branded condiment that was part of the ad.
As a marketer, where's the opportunity?
Again, there's potential in advertising. For the near term, this could be something as simple as a banner advertisement within a second screen TV listings grid, or perhaps in-app advertisement linking to a dedicated advertisers' portal with rich multimedia and graphics.
In the not too distant future this could evolve very quickly to something far more targeted and advanced.
For example, if the living room TV is displaying a national Ford commercial, the second screen could recognise this and deliver a more personalised ad to the second screen (i.e. a younger demographic receives a Mustang ad; a demographic living in a rural area gets a truck commercial, everyone gets a personalised offer to test drive at a local dealership). The sky really is the limit here.
Is the TV guide eventually going to become obsolete? As people look to each other more for recommendations?
If by 'guide' you mean the TV listings grid, then we'd say not anytime soon. Like it or hate it, the grid is the universally understood way to navigate TV content.
We see how people interact with these guides and based on Rovi's set-top-box reporting sample we've found that: 90% of the homes with a guide access the guide on a weekly basis, guide users visited the guide an average of 15 times a day and spend an average of 17 minutes in the guide daily - and one third of viewing choices are a result of choices made from the guide.
You sell data to the likes of iTunes, Netflix and co - but who are you backing in the streaming race?
As a white label provider for the industry we are not backing any particular provider, but rather the broader market shift to digital entertainment delivery. We expect the number of 'over the top' providers to continue to grow for the foreseeable future.
Bottom line in the streaming race is that we remain neutral. We truly just want streaming digital media to take off. We pretty much have a "powered by Rovi" strategy. We provide all the parts to make it happen (as mentioned above from the encoding, to the video delivery) so we are backing anyone who wants a great streaming experience. From an industry perspective, there are a few things that may cause a tipping point for streaming entertainment to take hold.
One is the quality of the experience. Consumers are used to the DVD or Blu-ray experience today, so they don't want the streaming content to get stuck buffering - they want it to play well and deliver a high definition experience – look for adaptive streaming technology to deliver this.
Also there is an opportunity to deliver high value features like directors' commentaries, alternate audio tracks for alternate languages, subtitles, smooth fast-forward and rewind. This may sound basic, but it is actually difficult in the streaming world.
A second element is getting existing content in the cloud. This was a significant factor in getting the music industry to switch from physical to digital sales. Once I could get my collection of CDs digitised, I started buying new music in digital format. This is likely to happen with video content.
If I can have all of my movies available in digital format in the cloud and be able to access them anytime and anywhere, then I am more likely to buy new content digitally. Look for "Disk to Digital" or "Digital Copy" solutions to deliver this change.
How is Ultraviolet (the unified 'digital library' that's supported by Rovi) going to change the way people consume content?
If nothing else, UltraViolet (UV) will help raise consumer awareness about the benefits and convenience of digital entertainment, fuelling the shift from disc-based entertainment.
For digital to completely replace physical disc distribution, the value proposition needs to be strong. Consumers need to feel confident that the content they purchase will be easily accessible to them across a range of digital devices.
In other words, digital has to offer the same portability and universal playback capabilities as DVD and Blu-ray Disc. UV is a major step in this direction. The other part of the value proposition is quality.
We believe there's still some work to do here in order to deliver the quality of DVD and BD in a digital environment.
What does that mean for consumers interacting with video, and what does that mean for brands?
The broader market move to digital content delivery is resulting in consumers having complete control over their entertainment experience.
Consumers now have the ability to enjoy what they want, when and where they choose. For brands this poses both a challenge and an opportunity.
Brands can no longer rely on a 30-second spot to reach their target market. They need to seek advertising options that reach consumers across the many platforms and devices they now use to consumer entertainment.
They also need to think more about the form and manner in which they engage consumers as one size no longer fits all.
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