IFA, IBC and Broadcast

Phew! The IFA report and most of this week’s main issue are done and I’ve just got on the train to the airport to fly out for the first IBC event, this evening. There are some other events today I would have liked to attend, but I just can’t get to Amsterdam any earlier after IFA – although with consolidation of the TV brands over recent years, I could probably save a day on my IFA trip next year.

The IFA & IBC shows are very different. While IFA is open to the public and covers not only TV, but all consumer devices including household appliances (which must have been a very good move from the point of view of the show organisers), IBC is a trade only, “professional” event. However, the world’s gadget press goes to IFA in their hundreds and it really is a fight to get meetings and interviews. IBC is the other way around – the press coverage is relatively small, so I get hundreds of requests for meetings after registration. I just looked in my IBC 2015 email folder and I have 250 messages, even though I have been deleting anything that I didn’t think was completely relevant.

Sometimes, in the past, the hot topic as well as the tone at each show has been different, but this year, one topic dominates and that is UltraHD, if you include in that term High Dynamic Range (HDR – the big topic at IFA) and Wide Colour Gamut (WCG). At IBC, I will be trying to get a better sense of how the standards for HDR, in particular, are developing. I get the feeling that Dolby might, just, have done enough to establish itself as the high end solution for pre-rendered content such as movies, but it’s less clear to me that the firm can win the battle for live broadcast, especially in Europe.

In the US, pay TV dominates and when that is the case, broadcasters can develop new technologies and improved services on the basis that they can charge a premium for them. This is what happened in the change to HD – a few broadcasters such as DirecTV offered HD and attracted high end consumers. Advertisers followed the consumers, so even Free to Air (FTA) broadcasters had to follow, to compete.

In Europe, public service broadcasters (PSBs) are still really, really important and they are in a tough position. Many of them, across the region, have barely finished the HD transition. They rely mainly on the decisions of the state (over licensing costs or grants) to boost their income. Guess how many governments in Europe are keen to spend more money on improving the TV viewing experience at the moment? That’s right. It’s zero. Nada.

So broadcasters really, really want to delay the shift to UltraHD if they can at all. In some countries, such as the UK, where Pay TV is well established by Sky and the increasingly aggressive BT, PSBs will have to react to UltraHD transition. However, companies such as Sky will also have to upgrade their STBs – a huge and critical investment and that means caution in rolling out.

In the days of the HD changeover, that was, effectively that, in terms of the TV battle, but now, in the US and Europe alike, there is a third factor – the OTT crowd led by Netflix and Amazon, who will simply bypass the broadcast infrastructure with UltraHD and put huge pressure on the Pay TV operators to upgrade. So, arguably, the Pay TV providers are finding themselves in a similar position to the PSBs at the time of the HD switch – they’d rather wait, but perhaps they can’t afford to.

Over the twenty years since we started Display Monitor, I have often talked about the different time scales of competing industries. I came into the technology business from the steel business where we had a new product every 20 to 30 years, whether the market was ready or not! The PC industry was on a different speed and the internet a faster one, still.

PSBs are close to the steel industry – with investment plans going to 10 years or so, while Pay TV needs to think on a 3-5 year investment window. However, the OTT industry is really working on a very short time scale, so has a big advantage at times of change, and in many cases, access to plenty of cash. They are also predicated on users supplying their own devices (or being able to use “disposable” ones, like Chromecast).

Over the next few days, I hope to get a better sense of how these three different TV constituencies at IBC see the battle ahead. It should be interesting!