The UK TV market is more robust and less threatened by VOD services, like Netflix and Amazon Prime, than its US counterpart, says digital media report.
Nigel Walley, managing director of Decipher, a digital media consultancy, has outlined several major differences that highlight both our high quality regulatory standards and fragmentation in the US market.
“We have to continually fight the temptation to get sucked in to the PR hysteria created in the US market. UK television execs seem to hang on every word that Reed Hastings of Netflix utters about the death of TV, without ever reflecting on the fundamental differences between the UK and the US.
“Most of his prognostications are meaningless in a UK context.”
1. The UK operates under a single time zone that allows us to share in national TV moments across major network channels in a way that is impractical in the US.
2. The electronic programme guide (EPG) is uniform in the UK with the first five slots guaranteed to the BBC and the FTA channels. In the US there are no such rules, with the positioning of major networks changing across service providers. The fixed positioning in the UK is influential as finding channels is part of a national ritual.
3. The high regulatory standards for advertising in UK broadcasts, as well as the advertising-free BBC, have offset many shifting from linear to VOD. In the US, the pervasiveness of poor quality, high volume TV advertising has driven many out.
4. A far greater proportion of US viewers than UK have paid for their TV service (In the US it is 86%, UK is 54%). Robust and high quality free-to-air (FTA) boxes in the UK, such as YouView or Freesat, which for many remove the need for pay-TV subscription, do not exist in the US. This major difference between the two markets has made VOD propositions, such as Netflix, more attractive to the US consumers accustomed to monthly TV subscriptions.
5. Platforms such as Sky, Virgin Media and TalkTalk are national in the UK but US counterparts are fragmented. The process of consolidation has not been total in the US and many small, poor-quality cable TV services continue to operate. These underfunded pay-TV platforms can’t afford to innovate, integrate VOD or secure quality content deals. Most also broadcast in poor quality SD signals. This gives great leverage to the VOD proposition.
6. The UK TV market has managed to co-opt the ‘enemy’, with many free-to-air set top boxes now offering integrated VOD services. This makes VOD and free-to-air services no longer mutually exclusive. Such innovation has not emerged in the US market.
High quality and uniform regulatory standards, free-to-air services and pay-TV platforms, as well as wide integration of VOD services, positions the UK TV market above its US counterpart.
DTG Staff | 23.02.2015