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Smart TV Apps: Business Model Barriers Hinder Revenue Opportunities

by User Not Found | Oct 03, 2012

If the television industry is going to get swept up in the apps hype wave there is little sign of it at this week's Appsworld event in London. There were hardly any stands demonstrating apps aimed at smart TV viewers, Accedo being a notable exception. And the dedicated TV apps conference track has focused on the many barriers which stand in the way of this emerging market while bemoaning the absence of any major revenue generation opportunities.

Accedo`s Michael Lanz did his best to drum up some enthusiasm for the TV apps business, claiming that he can already make business cases for ad-supported apps, if only in the larger smart TV markets. At the same time he admitted that "TV apps payment platforms are a mess right now. I haven't been able to make one payment using my smart TV and this is my business." Partly because one-time payment mechanisms are so user-unfriendly he believes that the TV apps business will be driven almost entirely by ad- and subscription-driven business models. That sounds a lot like how the TV industry works today, and Lanz's argument makes sense: television's industry structure will encourage entrants to adapt to its way of doing things.

The other key theme has been openness and standards, and we have heard the usual complaints that most developers will never be able to support smart TV until today's fragmented market evolves into one where one or two platforms are dominant. Unless, that is, you are the BBC, which has hundreds of developers making sure that iPlayer is available on 400 different connected devices. The BBC is now promising that the red button will evolve into a connected TV service, so that viewers will connect directly to the channel's respective online service by selecting the familiar red button on their TV remote control. Eventually the BBC will offer multiscreen red button services, so that smartphones and tablets will detect if the viewer is watching TV and synchronise content.

The most valuable contribution so far has come from Facebook's Karla Geci, Strategic Partner Development Director. In response to my question about advertising opportunities, she noted that multiscreen was allowing advertisers to become better storytellers. This is precisely what needs to happen - the active involvement and drive from the creative community - if multiscreen and smart TV technologies are not to be consigned as distant memories like so many other advanced TV technologies over the past decade or so.

David Mercer

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