2009 Australia - Digital Media - Online Video Market

BuddeComm’s annual publication Australia - Digital Media - Online Video Market  profiles the online video media market sectors. It provides market statistics, technical information and analysis as well comprehensive market overviews on online video, IPTV and mobile TV.

The report reveals that video applications over broadband have emerged over the last couple of years, as Internet media companies and content producers seek to exploit the added speed and capacity of broadband infrastructure. The killer application on these networks is video-based communication, mainly produced by users themselves.

While some of the incumbents are trying to create IPTV products, these services have so far largely failed to attract users, particularly where such services have to be paid for. Services like ABC’s iView have been far more successful.

Online video consumption is already producing promising statistics, with Google’s YouTube becoming a worldwide leader. New business models continue to emerge around the world as the players competing in the digital media space begin to pay serious attention.

Europe and Asia have had the most dynamic IPTV markets over the past few years, and recently in the USA the telcos’ IPTV plans – driven by HDTV, on the back of their fibre deployments – have started to gather significant momentum. But IPTV, at least in the format it was initially envisaged, is rapidly disappearing from the front page.

On the whole, customers around the world continue to be more interested in the web-based broadband video applications rather than IP-based TV. The economic downturn may also deter telcos from expanding their IPTV coverage over the next couple of years and subscriber growth could be curbed as consumers rein in their spending on luxury services.

There has also been an enormous amount of hype surrounding mobile TV, but the reality is that very few people are prepared to pay the prices the operators are charging for the service. The current technologies – and, more importantly, the business models – don’t stack up yet.

It may be a great engineering achievement, but where is the business model? Mobile video entertainment and communication services, however, certainly have a bright future – but we might have to wait for 4G before mass market applications are developed.

In 2009 the USA is one market to watch. A coalition of broadcasters plans to provide free, over-the-air programming across 22 US cities. While there are no devices yet on the market to receive such services the industry is hoping consumer electronics manufacturers will create appropriate devices.

It will be interesting to see what companies are going to be involved in all of this. The online video market is a meeting place of giants. The telcos were the first cab off the rank, as soon as they realised what they could do with the Internet. However, they became entangled in debating the need for a good broadband infrastructure prior to offering new media services. And the telcos lack the necessary media background. The media companies have staked their claim as well, and then there are the thousands of smaller Internet-based companies that are using online video in their offerings.

Telstra, in particular, remains adamant about its position in this new market. Under its BigPond brand it has made significant investments in the market. Others covered in this report are: Optus, Vodafone, Hutchison 3, Internode, Adam Internet, Unwired and TransACT. Non-telcos include: ROO Media, Video Ezy, Of the World TV, VOD and ReelTime (history.

Key highlights:

·         In 2009 new business models are beginning to emerge as the players competing in the digital media space begin to seriously take note.

·         By 2009, more than a million people were using Australian-based video media.

·         Telstra has run several IPTV trials and has indicated that it aims to use Foxtel as the vehicle for any IPTV services it may offer.

·         The ABC is looking at the possibility of getting Internet channels which stream live shows.

·         Within six months, users looked at more than 1 million iView programs.

·         With the boom in mobile wireless, the emphasis in the market is changing from content to access.

·         Users have the freedom to bypass mobile TV offerings from the operators and directly tap into their video media of their own choice.

Data in this report is the latest available at the time of preparation and may not be for the current year.