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Maintaining the Perception of Value in a Culture of ‘Free’

21st January 2014

It’s no longer a debate that huge advances in technology have fundamentally altered how content is delivered and consumed by the public.

Not only are content delivery speeds faster than ever, but picture and streaming quality is better too.

Concurrent to this technology shift, we’ve also seen rapid developments in how content is managed and distributed, with huge archives of material available at the touch of a button; catch-up services bringing disruption to the rule of linear programming; and on-demand services sating even the most demanding appetite. Coupled with this, we’ve also seen a shift in how programmes are commissioned (for example, Netflix) and thus the beginnings of a change in the ruling classes of content development.

The public has never had it so good – everything available right here, right now, and in HD quality, at the touch of a button.

However these developments and technological advances have not been developed for free, and all the key players in the media and content industries have spent hundreds of millions bringing such dynamic, fluid, and successful services to market. Unlike the cable/pay TV industry, though, many of these services haven’t launched with a premium price tag attached and as such, the consumer has come to expect high quality content and services at a low cost or even for free. This juxtaposition, surely, can’t last.

The challenge for the broadcast industry now lies in monetising these services to strike a balance between making the services accessible, but being able to recoup some of the millions of pounds invested in making them a reality. To do this, I believe we need to fundamentally shift the consumer perception of what is available under the banner of ‘free’, and what should be categorised as ‘premium’, and thus worthy of paying extra.

When the internet was in its infancy its role was, more or less, to simply deliver small html webpages to users and the copper-based infrastructure it was built on was able to service this need. Internet Service Providers could afford to undercut each other and bring about a low cost price-based delivery model. However, as demands for richer, bigger forms of content emerged, these models became unmanageable – it’s simply not possible to stream hundreds of thousands of episodes ofDesperate Housewives to homes across the country for the small fee the end user pays the ISP; yet the consumer has enjoyed years of price wars and has little or no value perception attached to internet access and content delivery over it.

This ‘free’ mindset is one which has now permeated every element of modern society, which is great for the consumer, but is a fundamental problem for the long term viability of any industry associated with it, and charged with delivering services and products to the public.

It won’t take one company to address this issue, it needs the whole industry to pull in the same direction and shift perception, if the problems the ISPs face in making themselves profitable following the price wars cited above are not to be replicated across the broadcast industry. We need to start looking at moving this value perception now before it’s too late.

Stella Medlicott, Chief Marketing Officer.
@StellaMed



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