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Monetising interactivity

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Interacting with TV has long seemed like a natural way to monetise passively watching programmes – but with fewer people watching and mobile now the screen of choice, interaction with TV is a very different beast. Paul Skeldon reports

Coming up in December on Netflix will be a very special episode of Black Mirror. Mirroring the dystopian world view of the series, Netflix is going to offer a chilling insight into the future of TV – adding the ultimate in interactivity: you choose what happens next.

The TV streaming service that has so shaken up TV as we know has, in fact, been offering this service in some of its kids shows for several months, but the Black Mirror roll out is a big deal. This choose what happens next is the ultimate in interactive TV services, but is one that has been tried so many times before over the years and has always fallen short.

To date, technical constraints have really what have held this back. Browsing choices in video was hard to pull off. Asynchronous streaming technologies pioneered by Napster and Pirate Bay and refined by Netflix and Amazon Prime could just make it possible – and it could usher in a whole new era of interactive TV.

While the Black Mirror idea is one to watch, monetising interaction with TV platforms has long been a mainstay in telemedia. But TV is falling from grace. Fewer people watch TV than ever before, turning to a range of devices to watch the likes of YouTube, Instagram and Netflix. Monetising interaction has peaked and dropped from mainstream TV.

Is interactive TV dead?

In a word, no. “TV is a trusted device and mobile is now its remote control – and it offers way more than the ‘red button’ ever could,” says David Wainwright, CEO, Hollywood TV. “The mobile is definitely the first screen these days, but TV is firmly the second – but using the two together can create services that people will pay for.”

According to Wainwright, quizzes, games, lotteries, casino games, shopping and adult are all interactive TV services that people will pay for and which can generate revenue still – “you just have to build trust and show just how good these games are,” he says.

“Freemium models are great to get people using these services and you can then build a relationship. But your service has to be slick and good and fun,” says Wainwright. “It will make money but it won’t be profitable on day one.”

What works?

With such a small but potentially revenue generating market, there has been quite a bit of innovation in TV interaction services. “It is lucrative worldwide and we are seeing new formats, new technologies, new programmes and new outlets,” says Claire McLaughlin, COO, The Cyber Authority.

That said, according to McLaughlin, the formats that are still going strong are old and well established formats in TV and radio that still attract huge numbers of participants, so while there are lots of new things that can be done with new tech, the old faithfuls can also be great.

“[These services are] relevant to people’s lives and fit in with shows that people like – it resonates with them,” explains Joanna Cox, General Manger, Association for Interactive Media & Micropayments (AIMM). “The key is to slot new services in seamlessly around them and build those up.”

AIMM is working hard to help promote interactive TV and radio services under Cox’s stewardship. These services have the potential to generate vast revenues and to be a key mainstream driver for getting people using direct carrier billing.

According to Cox there are three key elements for creating a successful interactive TV service.

  • Mechanic – to skill or not to skill and at what level?
  • Delivery of mechanic – frequency, entry method
  • Prize – is bigger always better? Everyone loves a winner.

“Get these right and you get more consumer trust and you start to see ARPU rising,” says Cox.

Then what?

While there are a cabal of hardcore interactive TV users, the number of casual players are dropping off, spread out over more channels and services and finding their kicks everywhere from other TV channels to gaming apps and even games and services on social media.

TV is still there and is the trusted man in the room, but increasingly any channel needs to ‘more than just TV’ – the TV component is just part of a multimedia offering, with interactivity spread over these channels liberally.

“TV players need to look much more at what they can do off-air as much as what they do on air,” says McLaughlin.

Interestingly, the charity sector is also playing a role here. As seen in our look at direct carrier billing opportunities (see page 4), charity donations not only kick-start the use of carrier billing in mainstream markets, but are also forcing price points available up. With £30 donations looking to be introduced, it could also provide a much needed fillip for the interactive TV game – increasing what can be spent.

Perhaps, however, it is the nexus of these sorts of services, traditional TV programming and other services built around them that will win the day?

Facebook is experimenting with adding interactive polls and quizzes to TV shows run on its Watch platform. These add a new layer to TV programming – rather than seeking to reinvent the wheel a la Netflix – which offer not only a way to encourage interaction and social comment, but can also generate vast quantities of data.

Social media has already shown that viewers aren’t necessarily passive watchers, but opinionated interlocutors that want to have their say and make their views known.

Understanding this holds the key to how to monetise interaction with TV and leverage the VAS and tools of telemedia to do so.

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Paul Skeldon

Editor and content creator for Telemedia – for 18 years and counting

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