Online TV

30.06.08 | MediaGuardian | A special report on the future of digital viewing In association with Brightcove The UK is a really competitive market with ! 150 pay-TV channels, Sky, Freeview, Tiscali " and BT’s TV service. Our video-on-demand service is a point of differentiation Malcom Wall, CEO of Virgin Media’s content division, p6

Introduction

Revolutionised TV

Online video has moved well beyond home movies of cats on skateboards and bad karaoke. In the last 18 months, video publishing has become a huge part of many websites and professionally-produced video content is being offered to growing online audiences. Meanwhile, telecommunications companies (telecoms for short), such as BT, have also recognised that offering TV and on-demand video services over broadband networks will help them to attract new customers (and keep existing ones). To do this they use a network technology called internet protocol TV (IPTV). In this supplement we look at how online video and IPTV are developing in parallel and, increasingly, in competition with one another and at the impact this is having on traditional media businesses. We investigate how the UK’s largest telecom, BT, is approaching it. Companies are testing the interactive capabilities of IPTV services and also looking at how to use them to target advertising. Video-on-demand services are being ramped up by pay TV operators as they look to stand out against rivals, such as BT. We look at the BBC’s ambitions to make the iPlayer work on a wider variety of devices and how its commercial sister service, Kangaroo, is starting to develop. Navigating the video content now available online and in IPTV systems is also explained. The online video revolution: websites such as YouTube, Bebo and MySpace have transformed how the moving image is used and viewed Rana Faure/Getty And we also explore how DVD rental businesses are changing to keep up with video on demand, iTunes and online video sites. Finally we look at the future of The giants awake high-speed networks in the UK. Without more and faster broadband connections, Britain risks being left behind. And we talk to Francesco TV channels and telecoms have scrambled to respond to the opportunities presented by Caio, the former boss of Cable & Wireless, who has been charged online video. But, as Kate Bulkley reports, none of them are quite sure what works yet with delivering a report on how to build and pay for upgrading the UK’s t is hard to believe that the phenom- Pay-TV channel Living is commissioning look at how to enrich the experience and for $1.6bn by Google and is the most- congested broadband network. enon we now know to be YouTube its first online drama series, but Jonathan be a little bit different.” watched video-sharing site, but it is still Kate Bulkley started barely three years ago. Webb, managing director of channel BT’s year-old video service is a case in estimated to be loss-making as a busi- Before this video-sharing website owner Virgin Media Television, says this point. BT Vision has attracted 250,000 cus- ness. Dan Cryan, analyst at Screen Digest, was created in mid-2005, watch- might cause problems. “I suspect there tomers who are able to order on-demand says: “Today it’s all about consumption, Inside ing and sharing online videos was will be constant tension between the team TV and films through a special set-top box not about revenue.” much more difficult and much less at Living and the online portal but that’s attached to their BT Broadband connec- This is particularly true with online content was available. fine and as it should be,” he says. tion. Unlike web-based online video, BT video from “free” sites. Online advertis- Since YouTube showed us the way, The burgeoning of online video has Vision offers a limited array of video to its ing is growing fast but most of the revenue 02 Delivery !online video watching has exploded and gone hand-in-hand with the availability users directly to their TVs and guarantees is from search engine advertising, not dis- Can phone companies compete in the video-sharing sites have proliferated. of broadband connections at an affordable a TV-like picture quality. “This is a man- play ads. Advertising attached to online crowded pay-TV market? Social networking sites, such as Bebo and price. According to regulator Ofcom, 57% aged service and we think we can give our video is still tiny when compared to total MySpace, were next to utilise the power of UK homes now have a broadband con- customers a better service if we can organ- advertising budgets. 03 Personalisation of video; they are now commissioning TV- nection, up from 53% in 2007. ise it and present it in a friendly way,” says Screen Digest expects total annual IP Matching content to individuals keeps like dramas for their viewers. Dan Marks, chief executive of BT Vision. revenues from paid services — includ- both audiences and advertisers sweet Traditional media may have taken a Keeping customers Marks admits that BT Vision is first and ing both online video and revenues from bit of time to catch on, but now newspa- The spread of broadband connections foremost meant to help BT attract and managed services, such as BT Vision — 04 The BBC pers, radio stations and TV channels are has not only spurred the growth of video keep its broadband customers. This is an to reach £333m in 2012, up from £31m in The iPlayer has been a massive success. all rushing to add video to their online viewing on the internet. The big broad- important part of the telecommunication 2007. The bigger share will come from What can competitors learn from Auntie? offerings. The UK’s biggest broadcasters band providers — including telephone company’s business model. But Marks also managed IPTV services, although this are all offering online catch-up TV serv- companies, such as BT — are increasingly says that once they get more subscribers excludes advertising, which is expected 05 Navigation ices led by the success of the BBC’s iPlayer, using video as a way to add value to their — the goal is two million BT Vision custom- to account for a large portion of total rev- What’s the best way to make sense of the which in its first six months has already broadband services, in effect bundling ers in the next two years or so — the service enue. Screen Digest estimates that adver- huge amounts of online TV and video? had 100m requests to view programmes. phone and broadband connections with can be profitable in its own right. tising will make up about £97m or half of Last month it was logging 700,000 online on-demand TV services. Already some 68% of BT Vision’s online TV revenues in 2012; but perhaps 06 Video on demand views a day. New Amazon-style recom- “Most telephone operators are in land- 250,000 customers pay for some kind of the figure to keep in mind is that by 2012 Can providers keep up with expectations? mendation tools, a “last played” service grab mode right now,” observes Steve TV or film programming package, quite the pay-TV market in the UK will be worth And how can they make a profit? that remembers the last 10 programmes Farmer, head of business development an achievement for a service that, unlike £6.4bn, up from £4.4bn in 2007. a user has watched on iPlayer and the at Motorola. “For them, it is about how to Sky TV and Virgin Media, doesn’t require “Online video is the hottest advertising 07 Bandwidth/DVDs addition of BBC radio programmes are all deliver a me-too, digital TV service to com- an ongoing subscription. “I think 68% is a media going right now in terms of brand Plans to improve the national broadband part of a new test version of iPlayer that pete with cable and satellite pay-TV. When sustainable number,” says Marks. marketing,” says Adam Berrey, vice-pres- network, plus will DVDs survive? launched last week. they get to numbers in the hundreds of ident of marketing and strategy at Bright- By the end of the year, ITV, Channel 4 thousands of users, then they will begin to Where’s the profit? cove, a technology company that supplies Commissioning editor Kate Bulkley and BBC Worldwide, the commercial arm Despite Marks’ sanguine view of BT online video platforms to clients including Produced for Guardian Professional, of the BBC, will launch a shared online site Vision’s future, the formulas for money- Channel 4 and the Daily Telegraph. “The a commercial division of Guardian (known as an aggregation site) that will ‘Most telephone making out of both web video and man- problem is that there is a lot of consumer- News & Media. All editorial content include programmes from all three broad- aged systems, such as BT Vision, that use made video on the net but a lot less pro- is independent of the sponsor and casters. The new site, with the working operators are in land- internet protocol technology to deliver TV fessional video that brand marketers are commissioned by the Guardian. name of Kangaroo, is expected to include (IPTV) to users, are still being written. comfortable with.” Paid for by Brightcove advertising and subscription services. grab mode. It is about There are big questions about how Berrey believes that, for at least the Advertising contact David Clayton at The online opportunity — especially for how to deliver a me- fast online video can become money- next 18 months, there will be many dif- Guardian Professional on 020-7131 7086 pay-TV channels looking to expand their making, or if it ever will. Industry behe- ferent approaches to how to exploit and For information on supplements audiences — is also causing a dilemma. too, digital TV service’ moth YouTube was purchased in 2006 make a business out of online video. ≥ visit:guardian.co.uk/supp-guidelines 2 The Guardian | Monday June 30 2008 Online TV Delivery Competitive players jostle for attention

Media. “For telcos, IPTV and on-demand opened it up to non-Sky subscribers. For Are companies like BT really services are a defensive play against the us, internet TV is about enhancing the TV able to compete in a crowded attractions of the Sky Plus set-top box” platform we already have.” which includes a PVR, and other pay-TV While it is too early to say which play- pay-TV market against services. Meanwhile, Sky now offers both ers will dominate the UK’s emerging IPTV established providers such telephone and broadband connections, so marketplace, success will surely be driven it is moving fast into the traditional busi- by the ability to personalise services and as Virgin Media and Sky? nesses of the telephone companies. a guarantee of a certain level of qual- ity for the video, avoiding the buffering Meg Carter No room for telecoms? problems often encountered with video Sky claims phone companies will play delivered on open internet sites such as only a marginal role in TV services because YouTube. As broadband is now the frontline in the they are not a natural add-on for compa- “True IPTV is closed, quality, tightly battle for IPTV market share, British tel- nies from the telecoms sector. targeted, broadband-delivered and can ecommunications companies are increas- “Our approach is to build outwards be a broadcast TV replacement,” says ingly offering value-added video services from the core TV experience,” Sky direc- Marcus Liassides, chief executive of IPTV as part of their broadband packages. tor of on-demand, Griff Parry, says. “Many provider Inuk Networks, which is work- While BT and Tiscali are developing other players, however, are trying to build ing with Cable & Wireless to develop a their offerings, Orange has delayed a [entertainment services] from the PC and residential IPTV service launching later launch of video services as part of its mobile space, which is clearly more of a this year. “But IPTV services need to broadband offer in the UK and O2 has said challenge as they have no reputation for look, taste and smell like a new breed of it won’t add such a service because of com- delivering TV.” interactive service, rather than emulating petitive pressures. Both broadband and Sky now sells broadband, telephony, traditional broadcast TV, and that will take multi-channel TV are fiercely competitive entertainment and a growing portfolio time,” he says. sectors in the UK. Indeed, Tiscali is on the of personalised and interactive content. It will take time, too, before it becomes sales block, underlining the difficulties of Last month it began the phased re-brand- clear whether telecoms such as BT and making a go of delivering broadband and ing of Sky Anytime — previously, a com- Orange, or competitors such as Sky and TV over broadband, called internet proto- bined offering spanning time-shift TV via Virgin Media, will take control of this new col TV (IPTV) in a market with entrenched Another established player is Tiscali. Phone and broadband providers are the set-top box, extra TV via the PC, and market. players. The Milan-listed internet company is up moving into the TV market to deter mobile TV. The PC service, re-named Sky “The fact is, we’re not even at the start- BT’s first quarter of 2008 results under- for sale and reportedly attracting the inter- others such as Sky and Virgin Media from Player, is internet-delivered. ing line here in the UK,” Liassides says. line the strategic importance of broad- est of Vodafone and BSkyB. IPTV service taking their business Photolibrary “Sky Player is proper TV delivered via PC “There are no serious IPTV platforms yet. band. While BT’s group revenue rose 2% Tiscali TV (formerly called Home Choice) and a platform for new internet TV serv- BT has positioned itself as the Blockbuster to £5.4bn, broadband revenue was up offers broadcast channels and on-demand ices,” Parry explains. “We’ve introduced video of the sitting room but is yet to prove 25% year on year with BT Vision — BT’s services to about 50,000 subscribers in new linear services, third-party channels, itself a credible replacement to traditional IPTV service — playing an important role. the UK and is working hard to differenti- improved functionality — you can now play TV. As BT gains traction, though, others BT Vision combines Freeview TV chan- ate itself. content without any delay — and we’ve will start to move.” nels with on-demand TV and film serv- “Our unique selling point is the way we ices using a BT broadband connection mix up content to make it easier for the to deliver the service to users through a consumer,” says Jonathan Sykes, manag- BT Vision Just browsing … bespoke set-top box. ing director of content strategy at Tiscali “We’re trying to satisfy customer TV. Latest enhancements to Tiscali TV demand for broadband, telephony, and include a personal video recorder (PVR), In a pioneering move, BT Vision is going head of interactive and commercial media. integrated into content, with web entertainment from one supplier,” says while a new search and recommendations to add a web browser to its broadband “Using HTML allows us to integrate web and TV content brought together Dan Marks, chief executive of BT Vision. tool will begin operating soon. internet protocol TV (IPTV) service in content into our service in a relatively simultaneously on the same screen — a “Telcos are into IPTV for one reason: con- While BT and Tiscali have established August. The move will allow BT Vision simple, cost-efficient way. This, in turn, development with clear potential for vergence. If we don’t provide entertain- IPTV models, Orange is taking its time to users to search for and access some will offer customers a deeper, richer and advertisers, says Carbonari. These plans ment, someone else will.” perfect “the experience, service quality types of content from the web and view more flexible way to access and consume are completely separate from trials BT and content” of its IPTV service, which it on their TVs though their BT Vision content.” Broadband is running with Phorm, a Third player launches later this year. Orange’s digital set-top box. But only limited access to the web web-tracking tool that recently attracted BT Vision has attracted 250,000 users in TV director, Tim Pearson, insists that, BT Vision plans to wrap the web will be allowed. For instance BT Vision controversy over its ability to track what its first year — a relatively small number, despite postponing a launch last Decem- content with interactive applications and customers will not be allowed to go to users do online and then serve targeted which means the division is still working ber, IPTV remains a priority. advertising services and, next year, new YouTube or use peer-to-peer sites such as advertisements to them. towards becoming profitable, but Marks O2, however, says it has no plans to transactional services, such as gaming BitTorrent, which encourage illegal file- “Using the BT browser, advertising says its subscriber base is currently grow- launch IPTV in the UK, despite the fact that and home shopping, will also be added. sharing of uncopyrighted material. “This and sponsorship can be inset as it ing faster than that of Sky and Virgin, com- parent group Telefonica already operates “As a service, we’re highly is not about free-to-roam access to the would be on the web,” says Carbonari. bined. Plus, two-thirds of BT Vision users a number of fast-growing IPTV services differentiated already — no one else web but ease of access to a wide array of “Added to this will be a new advertising subscribe to some kind of pay-TV offer. on the continent. “The reasoning is sim- delivers the massive range of on-demand content from partner sites, which we will management system that we are now The strategy is to not just to produce ple,” O2 spokesman Simon Lloyd explains. content as quickly or in such high quality, have identified as offering complementary procuring, which will allow advertising more reasons for BT customers to stay “IPTV has succeeded in markets where sat- without a minimum monthly spend content to the range of content we already to be inserted in and around video-on- with BT, but more reasons to pay — which ellite and cable TV penetration are patchy. or subscription,” says BT Vision chief offer,” Carbonari explains. demand content — a feature we expect is why the BT Vision platform is also In the UK, however, multi-channel TV is executive Dan Marks. “The next step, One of the first new services is a to launch early next year.” extending its functionality, and develop- already widely available, which is why we however, is personalisation, interactivity web-based sports zone where users can MC ing special interest and personalised serv- have no plans here for the time being.” and a new generation of transactional download data, news feeds and results. ices. The imminent launch of BT Vision on O2’s stance surprises Duncan Perry, services — a major focus for us over the Another new application will allow sharing the Xbox is the first step in an emerging strategy director at media agency Steak next year, and the development of the of content — providing users with an area cross-platform strategy. The consumer browser is the first part of this.” online to store family pictures or home launch of the BT Vision browser, mean- BT Vision’s browser will differ from movies for friends or relatives to view. while, will offer users access to a range of Sky believes that a standard web browser because Next year’s plans call for the BT additional web content (see box). navigation will be done using the remote Vision browser to become more closely “We see ourselves as a retailer of dig- traditional phone control, not the conventional tool bar ital entertainment,” Marks explains. “And you use on the computer. “The browser that means sometimes you direct people companies will play runs on the set-top box and allows to other people’s brands and other retail- only a marginal role the TV to display HTML web pages,” ers’ concessions. It’s what people want: a explains Antony Carbonari, BT Vision’s total entertainment service.” in TV services The future: interactive and free? BlinkBox Top of the charts Top movie clips viewed in April 2008 9. Breakfast At Tiffany’s (Free and ad-supported) 10. Ocean’s 11 (1960) 1. 300 — to rent or buy via download — from the many and varied, including the BBC’s 2. Happy Feet The set-top box is old hat. likes of Aardman Entertainment, Fre- catch-up service, BBC iPlayer, and the 3. Knocked Up Finding programmes on it mantle, Discovery, Warner Bros, Univer- ad-supported content aggregator, Joost. 4. Ali G in da House sal and Paramount. One service allows Comish says the most worrisome com- 5. American Pie: The Naked Mile is hard and there are more you to “clip and send” a video text (a petitor could be Kangaroo, the online 6. House of Wax available online — at least piece of video and a personal message) video site backed by the BBC, ITV and 7. The Bourne Ultimatum to friends’ mobile phones. This service, Channel 4. Unlike BBC iPlayer, Kanga- 8. Tomorrow Morning that’s what blinkBox claims called “blinking”, is used by one third of roo will offer TV programmes following 9. 40-Year-Old Virgin blinkBox’s registered users. a free, catch-up viewing period on the 10. South Park: Bigger, Longer and Uncut Kate Bulkley “We think that intelligent or informed broadcasters’ own sites. This is exactly Top 10 downloaded (to rent) April 2008 discovery is what makes the PC stand out where blinkBox is developing its market, (Average Cost £1.99) from a set-top box service,” says Comish. with a view to make more of its content 1. Crank Michael Comish has seen the online video “The set-top box is just a dumb box. Try and free and ad-supported. 2. American Pie: The Naked Mile future and he says it’s ad-supported and find a particular title out of 100,000 pro- “The fact that Kangaroo is being looked 3. 40 Days and 40 Nights interactive. “In a five-year timeline the grammes using a standard EPG (electronic at by the Office of Fair Trading, and that it 4. Scarface growth is in video on the net, not in catch- programme guide). It’s not an easy task.” will likely not launch until the end of the 5. The Bourne Identity up-TV or in video-on-demand (VOD) on Like all online video sites, it’s early year, means we have six to nine months 6. Bridget Jones: The Edge of Reason a set-top box,” says Comish, the chief days at blinkBox: launched commercially more time to aggregate an audience,” 7. The Big Lebowski executive of blinkBox.com, a new online in April, it counts 300,000 unique users says Comish. “The battle of the next six 8. The 40-Year-Old Virgin video site. a month and an impressive growth rate months is about getting the rights to offer 9. Ali G in da House Comish’s credentials in reading the of nearly 60% between April and May. free, ad-supported TV.” Top 10 movies downloaded (to own) 10. Elizabeth digital tea leaves come from his time as “There are huge economies of scale in Getting those rights has been a tough April 2008 (Average cost £7.99) Source: BlinkBox European managing director for online online video, both in costs and in reach, sell to rights owners who are more accus- 1. 300 film pioneer Atom Films (sold to Viacom and the bet really is how big an audience tomed to the pay model for video-on- 2. Blood Diamond in 2006 for $200m) and at Channel 4 can we get?” says Comish. demand and pay TV. Another problem 3. South Park: Bigger, Longer and Uncut where he oversaw the early development is that the rights for ad-supported TV 4. The Assassination of Jesse James by of new media ventures. Two years ago Beware of the Kangaroo are being held back by broadcasters that the Coward Robert Ford he teamed up with Adrian Letts, former Blinkbox backers, venture capital firms want to exploit them on Kangaroo. 5. Mars Attacks head of global content at Vodafone, to set Eden Ventures and Arts Alliance, hope “The BBC will be in a very tough posi- 6. The NeverEnding Story up blinkBox. that blinkBox is far enough ahead of tion having decided to put ad-supported 7. Happy Feet Today the site offers more than 10,000 the competition to make its mark, but content on Kangaroo to withhold it from 8. Angel Eyes clips as well as films and TV programmes the pressure is on. Its competitors are other ad-supported sites,” says Comish. The Guardian | Monday June 30 2008 3 Online TV Personalisation Why advertisers love tailor-made television

their account and consume content by the Viewers want TV specifically hour without taking out a subscription,” targeted at their interests. he explains. But Jonathan Sykes, managing director IPTV has the ability to deliver of content strategy at Tiscali TV, urges cau- it — but who will pay for it, tion about adding lots of bells and whis- tles. “IPTV allows for personalisation to the consumer or advertisers? a micro-degree, but the bigger — and, in my view, more important — challenge is Meg Carter how to keep it simple and easy for the con- sumer to use.” Sykes argues that all IPTV platforms Internet protocol TV’s unique selling point want to strike content deals with Hol- is the ability to provide a new generation lywood studios and other leading con- of TV services characterised by internet- tent suppliers, so it won’t be long before style, real-time interaction. the content available on each service is “IPTV’s most obvious potential is for pretty much the same. At this point the the more intimate relationship it allows key differentiator will be ease of use and between supplier and customer,” says customer service. “It’s not just a question Alan Delaney, business development of getting enough IPTV set-top boxes out director of IPTV at Tandberg TV, part of there,” Sykes stresses. “As important is the Ericsson Group. “A significant com- that the creative community — content mercial opportunity exists for advertis- producers and advertisers — getting to ers eager to develop dynamic contextual grips with the whole idea.” advertising.” Michael Comish, co-founder and chief Delaney points to developments in executive of film clip and download web other markets in Europe and across the service blinkBox, endorses this, although globe where personalisation and interac- with one caveat. “To become established, tion have been added to entertainment IPTV and internet-based services such as as well as transaction services, making ours will need the understanding and it easier to “monetise content” and keep involvement of advertisers.” users engaged. According to Comish, the challenge is changing the ad industry’s current mind- Content is still king set. For the time being, media buyers have Because IPTV systems are closely man- a fixation on paying premium prices for aged by operators, personal channels reach. “Only when these values change can be created by users according to their — and brands become ready to pay a pre- tastes — by programme title, genre or mium for targeting specific groups — can what other people are watching. But this revenue potential be realised,” he says. Advertisers will have to change tactics to adapt to the plethora of channels and content available on the web Getty is “only the start of it”, says Marcus Lias- Inuk’s Liassides says that while most sides, chief executive of IPTV provider advertisers claim they want their mes- Glossary Buzzwords Inuk Networks, which runs Freewire TV, sages to be targeted , none are geared up to an IPTV service for UK students. exploiting the platform’s true personalisa- “Freewire customers have an in- and tion potential. “It’s an attitudinal divide outbound widget [application] to pull in that must be bridged.” Aggregator site is client software or IPTV (Internet Protocol Television) is TV Roadside cabinets are connection or send out content,” Liassides says. “For a web application which aggregates content that, instead of being delivered points for telephone and fibre-optic example, someone using Freewire to go syndicated web content such as news through traditional broadcast and cables located in residential streets onto Facebook will be able to see which ‘IPTV allows for headlines, blogs, podcasts, and vlogs in a cable formats, is received by the viewer that then connect to homes in the of their nominated buddies are watching single location for easy viewing. through computer networks. IPTV is surrounding area. what at that precise moment on TV.” personalisation to a typically supplied by a service provider “Pay as you go TV” is another person- micro-degree, but the Access network is that part of a using a closed network infrastructure. Video-sharing site is any site that allows alised service that Inuk is now exploring, communications network, that connects individuals to upload video clips to share targeted at frugal students. “With a one- bigger challenge is subscribers to their immediate service Online video or internet TV is television with others over the web. The most to-one, direct, real-time connection with provider, for example, Virgin Media. distributed through the web. famous of these is YouTube. the viewer you could allow them to top-up how to keep it simple’ Throw away your TV, Synergy Domino’s and Freewire it’s all on the laptop

are not likely to be played out in court. A loophole that allows live “We’re in sabre-rattling time but why television from public-service should Zattoo change what it is doing? And broadcasters also have to weigh the broadcasters to be screened consequences if a court case doesn’t come on websites is threatening out in their favour. [If a legal action finds against broadcasters] then there is a prec- to shake up the industry edent for free carriage on the internet and that can’t be in their interest.” Jemima Kiss A BBC spokesman says the BBC has not made any licence agreement with Zattoo and that it is reviewing its linear syndica- Just as the BBC’s iPlayer is building up the tion policy “following a number of trials UK audience for online catch-up TV, sev- around internet redistribution”. eral new players are hoping to do the same Livestation also offers feeds from news for live TV services on the computer. broadcasters, including CNN, BBC World The model makes sense because and Al-Jazeera, but has chosen to negotiate broadcasters can reach a global audience with broadcasters before putting channels through broadband at a fraction of the cost online. The company’s chief executive, of traditional broadcasting, and territorial Matteo Berlucchi, admits that his service rights can be maintained by identifying is a disruptive technology. Livestation the location of the user. “wants to do for internet TV what Skype Companies including Livestation, Inuk did for web telephony,” he says, referring and Zattoo say there is a good future for to the VoIP service that threatens tradi- live, streamed TV online. However, Zat- tional telecoms by offering calls for free. too has left a bad taste in the mouth of Livestation will offer advertisements some broadcasters that feel that the dig- in the five-second delay between channel ital rights to their programming are being changes. It also plans social elements with taken without proper compensation. recommendations and messages from Since late April, Zattoo has added friends as well as an alert system to flag up Student Rhiannon Lord watches TV on her laptop at the University of Wales Institute, Cardiff, halls of residence all five UK broadcasters to its line-up of breaking news and programme reminders. 190 channels offered on its website. The Still in trial, the full version will roll out by Domino’s Pizza is one of a small By inserting its ad into Freewire’s because of the big cost and also because Swiss-based company launched the UK the end of the year. but growing number of brands service, Domino’s was able to reach advertisers limit their analysis to 60 or channels without having contracts with Inuk has based its approach on the view experimenting with addressable TV students alone — reducing wastage by so demographic profiles — any greater them, taking advantage of a loophole in that consumers want TV, not on their PC, advertising over IPTV. In May, the avoiding other audience groups. This degree of segmentation would prove too UK copyright law that says cable compa- but on their television. Inuk’s Freewire company ran one of its ads during points the way towards advertisers costly and time-consuming to manage. nies have the right to show live TV from service is being tested with students, breaks in Countdown on Channel 4 to segmenting IPTV audiences by There is, however, another benefit of public-sector broadcasters so Zattoo offering 50 TV channels for £10 per month. target university students, watching on demographic or geographic profiles. increasingly addressable advertising. thought it could do the same. “We are very broadcaster- and advertiser- IPTV, while other viewers to the show, “IPTV allows different content to be “Domino’s helped build its brand in the “We would not have entered the UK focused,” says Marcus Liassides, chief watching on TV, viewed a different ad. sent to different homes,” says Packet UK through an on-screen sponsorship market unless we were sure that what we executive of Inuk. “ITV puts out hours of Targeting was made possible by a Vision’s Charlie Horrell. “From an of The Simpsons,” Horrell adds. “With are doing is legal and in agreement with content but their Barb ratings figures are partnership between Inuk’s Freewire TV, advertiser’s perspective, that is highly concerns about food advertising to kids, UK broadcasters,” says Zattoo’s UK man- really very vague. We can target advertis- Thisa closed is appropriate IPTV network dumm fory te univxt thatersities is attractive.” it has since had to loosen its association. ager Alexandra Illes. “We’re very confi- ing down to consumer level, so we might beingwhich emplo delivyersed inTV order channels to ascer to studentstain an ’ The technology could, in its extreme, But this would not be a problem if it dent about the future of the service.” know 3,629 people watched that show” — approlaptops,ximate and leng Packet Vision, a specialist in allow for one-to-one communications could target sponsorship in a Michael Ridley, a partner at law firm and that is something that is very valuable advanced video advertising. although that won’t happen, says Horrell, personalised, IPTV environment.” MC DLA Piper says that Zattoo’s actions to advertisers.