3 Factors Shaping the Global Content Market

By Pierre Ziemniak

MIPTV 2015 is just around the corner, and as hard as it is to predict what the biggest trends are going to be in the TV industry for the months to come, here are a few observations based on our program and keynote announcements. What does the year’s biggest gathering of entertainment industry professionals tell us about the industry itself?

The Millennial Shift

First and foremost, our theme this year is “The Millennial Shift”: consumer habits are changing faster than ever and the

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market must adapt to younger, mobile, and multi-connected audiences. This is not a new phenomenon, of course, but millennials are the consumers of tomorrow, and as media users, their habits tell us a lot about the future of TV distribution, content, and formats. Personalization, streaming, and interactivity are the three key words of this major shift, which sees the rise of web platforms — and YouTube is just the tip of the iceberg here, given the high number of many multi-channel networks competing to reach millennials.

This is where a few clarifications are necessary. The “second screen”? It’s not as relevant as it used to be: “We seem to have quickly skipped from online devices being the second screen, to them being the first for many generations, especially the all-important millennials,” says Matt Campion, founder/creative director at Spirit Digital Media, the UK-based digital and social-media production agency. “Cord-cutters”? “Cord-shavers” may be a more appropriate term for millennials, who have actually reduced the amount of time they spend in front of traditional TV without totally abandoning it.

More than ever, the connection between offline and online viewing is key. Viacom, for instance, recently created “appisodes”: more than just catch-ups tools, these new formats offer interactivity and many more options. The My Nick Jr app for kids’ network Nickelodeon is already a huge success.

Even more important in this new online landscape are social networks, which have joined the race for content for good, redefining the boundaries of entertainment — and online gaming has a lot to do with it. Just a few figures: Facebook paid $2 billion last year for virtual-reality gaming platform Oculus VR, and Amazon bought the broadcast gaming and eSports platform Twitch for $970 million. According to research company IHS Technology, eSports will represent 6.6 billion hours of viewing globally in 2018 from 2.4 billion hours in 2014.

These major changes will be highlighted and analyzed at the MIP Digital Fronts, the last two days of MIPTV totally devoted

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to online entertainment. MCNs such as Machinima, Collective Digital Studio, and AwesomenessTV — to name but a few — will be present to showcase their most talented creators, and offer the MIPTV audience a glimpse of online video’s future.

According to Machinima’s chief content officer Daniel Tibbets, money is the number one issue when it comes to millennials: “Millennials won’t pay $150 a month for cable, so you have to figure out how to hit them with the right content,” he says, further explaining that “the traditional TV networks must look at their release windows not as a syndication function but as a programming one.”

Collective Digital Studio’s Paul Kontonis insists on the need to be platform-agnostic: “We create entertainment programming on whichever platform it makes the most sense. If it’s a Vine series we’ll do a Vine series, if it’s a Vine series and then a TV film so be it. If it’s a YouTube series that should then go to Instagram then so be it,” he says.

And, last but not least, New Form Digital’s Kathleen Grace stresses the importance of storytelling: “it’s not about TV, it’s about content across multiple platforms that tells a story [millennials] can relate to. There is a huge opportunity there.”

Monetization, of course, remains problematic in many cases. But this should change soon, according to JWT Worldwide’s Lucie Green, who says that advertisers will respond to these developments. So, will millennials’ habits change the industry for good, judging by the new formats and distribution models that have emerged these past few years? As HBO, CBS, and Sony unveil their online-only video services, there are reasons to believe that 2015 will be the year when online viewing becomes more than just a trend for the new generation.

From Small Screens, to All Screens

The second biggest trend witnessed and discussed MIP after MIP is that quality TV is now everywhere. Indeed, the best shows are no longer reserved to networks and cable, and can be found on broadband platforms. Here too, MIP Digital Fronts has positioned itself as a marketplace for current and next-generation content producers eager to reach online and mobile platforms, as well as for traditional broadcasters trying to attract young audiences — in any case, talent and quality content matters above all else.

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Global media companies are fully aware of this shift and are now officially focusing a large part of their activity on digital channels — especially YouTube MCNs. The Walt Disney Company, for instance, paid $500 million for MCN Maker Studios — a MIP Digital Fronts founding partner — last year. Another MIP Digital Fronts founding partner, Vice Media, amassed $250 million from A+E Networks (which is partly owned by Disney). Hearst and DreamWorks Animation jointly own AwesomenessTV — another MIP Digital Fronts presenting partner — while FremantleMedia has formed digital-content studio Tiny Riot and has content partnerships with fellow RTL Group subsidiaries BroadbandTV and StyleHaul.

These moves are backed by research. International video-technology provider Ooyala reports that 706 million-plus homes — nearly half the world’s TV households — will be watching online video by 2020, up from the 374 million forecast for 2014. There’s more: media agency ZenithOptimedia predicts that global advertising revenues will reach $545 billion by year-end. It foresees TV advertising’s share remaining the largest by medium, but dropping to 37.4% in 2017 from 39.6% in 2014. The revenue share of desktop internet ads is expected to grow to 19.6% from 18.8% during the same period, while mobile ads’ share will leap to 11.4% from 5%.

The Emmy-nominated “What’s Trending” is a good example of a digital-first show being adopted by traditional TV operators. A daily interactive show on YouTube devoted to news topics that have gone viral online, “What’s Trending” has featured a host of celebrity interviews, from Arnold Schwarzenegger to Harry Potter himself Daniel Radcliffe. The team is now working on a digital series for Viacom’s VH1 network — even more impressive, it has a syndication agreement with the US’ CBS network. “’What’s Trending’ is the new water cooler, with fans sharing information, photos, and videos online. Not only do we get people through the noise of it all, we also entertain,” says Shira Lazar, ‘What’s Trending’ co-founder and presenter. “Two years ago, premium content on YouTube was rare. Now, anyone can take a camera and shoot something that could end up being good enough for television.”

In other words, democratization of content creation has never been more felt within the TV ecosystem — although it remains unclear what kind of long-term impact YouTubers and other online video creators will have on the industry as a whole. One thing is certain: authenticity and quality of content are no longer bound to the traditional TV screen.

The Race for Branded Entertainment

A third major TV trend these days is the rise of branded content as a new entertainment form — it has been the case for several years now, with the MIPTV Brand Of The Year Award given to innovative brands in this field, include American Express, Heineken, Intel, and Vice Media. Chipotle and Piro won last year for their “Farmed and Dangerous” series on Hulu.

The reasons for brands to create content are numerous — being entertainment providers offers them flexibility in terms of

reaching consumers through digital technology. A prime example is Marriott Content Studio, a subsidiary of hotel and resort group Marriott International: it was launched last September and is already winner of the MIPTV 2015 Brand of the Year award. Marriott has indeed managed to position itself as a content creator in record time, taking into account all the industrial shifts listed above: “We want to own the travel-and-lifestyle space,” says David Beebe, Marriott International’s VP of creative and content marketing, global marketing. “The journeys made in that lifestyle lend themselves to content naturally, because travelers are constantly tweeting, taking photos and videos, and capturing their adventures. We want to respond to that by creating content in all formats for all screens.”

Marriott has already formed partnerships with established celebrities, YouTube stars, and content producers, and will distribute its shows via social media (Facebook, Snapchat and Instagram), YouTube, and in-room screens at Marriott’s 4,100 hotels in 78 countries — not to mention the fact that they will be licensed to interested broadcasters. Marriott-developed entertainment notably includes comedy short film “Two Bellmen.”

The goal, says David Beebe, “is to produce engaging content that builds communities of people passionate about travel that will drive commerce.” And building communities will undoubtedly be a trend to watch in future years, depending on the brand’s culture and objectives — a powerful way to both engage consumers and create content that will rise above the noise and stand out in this ever-evolving media landscape.

Millennials, screens of all sizes, and branded content will thus be at the center of all panels and discussions at MIPTV — three topics that are shaping the industry day after day, with huge financial, managerial, and creative impacts. But what makes us live as an industry will remain the same: creative people eager to tell new stories in innovative formats — in a word, talent. Screen size, consumer habits, and brand-supported projects may matter more than ever, but good content always has, and always will.

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This article was adapted from the MIPTV 2015 Preview magazine, available online at miptv.com. To find out more about MIP Digital Fronts at MIPTV, click here!