Why CloudTV?

Make way for two-way viewing

In a world dominated by the internet and increasing interconnectivity profound changes to the TV and video ecosystem are inevitable. Deloitte predicts that the vast majority of TV viewers will continue to tune in based on TV schedules will continue to dominate TV viewing in 2012 with a majority of audiences remaining aligned with them. However, it also forecasts that only 0,1% of the $227 billion global ad market will be spent on targeted TV ads. While consumers will continue to enjoy programs via traditional TV in large numbers, most of the future growth in viewership will take place on new screens like PCs, tablets, and smartphones, and through new, nonlinear video formats. It is estimated that by 2015, younger audiences will spend only half of their video watching time on traditional linear TV.

A number of key trends are shaping, and will ultimately shift, the way that TV and Media are currently engaging their audience as well as how they achieve durable revenue growth:

1. Behold the multi-tasking mobile viewer

Two-way viewing is no passing trend, it is here to stay. The good news? People want to keep watching TV. The even better news? They want to interact and connect with it in new and revolutionary ways. Is it me or is there a whole lot of opportunity in this room right now?

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The rapid worldwide adoption of mobile devices and social networking has transformed how we connect, share, and communicate. On average, just over half of US, and nearly one third of European, smartphone owners accessed Facebook on their device in the three-month period ending June 2011. Meanwhile, Twitter reached 12.5% of the smartphone audience in the US and 7.4% of their European counterparts. The Wall Street Journal recently reported that Facebook had 845 million active users at the end of December 2011, of which over 425 million access the site daily.

Social media users spend an average of 5.4 hours a month engaged in networking sites and half of TV viewers tweet about TV shows. An analysis conducted by NM Incite, a Nielsen/ McKinsey Company, and Nielsen looked at the correlation between online buzz and television ratings and found a statistically significant relationship throughout a TV show’s season among all age groups. These figures indicate that such rapid adoption has the potential to transform how we watch TV. It will deliver more relevant and personalized TV than ever before. Viewers will have more ways to discover and share shows and movies they love. And social features from chatting to games will increase viewer enjoyment.

The rise of second screen viewers: a key trend that TV and media companies can ignore at their own peril..These individuals engage with social networks and TV shows in real-time through the use of a mobile device. Users post, tweet, and chat on their smartphones and tablets while watching their favorite shows full-screen. As the number of mobile device users is growing exponentially, we can only expect this trend to develop further. Deloitte predicts a growing number of tablets will be purchased by households that already own at least one, indicating a potential growth in the number of second screen viewers per home. Another set of mobile device users is on the rise: ‘Catch-Up Commuters’ who use their mobile devices to watch TV shows that they were unable to catch on TV.
There is an unprecedented opportunity to engage these connected audiences in fun, innovative and relevant ways that increase viewership, build brand advocacy and drive revenue.

2. More bang for your e-buck

Online, online, online. It’s where advertisers want talk to potential customers. It’s where TV needs to make that discussion possible. It’s a no-brainer.

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Advertisers’ shifting interest from traditional TV to online ads is having a major impact on the TV and Media industry. The channels that garnered the most new ad dollars by 2010 were digital media (88%) and mobile media (52%). Experts predict that advertisers will increasingly invest in online display based advertising. The change in the social games business model, from paid add-ons to advertising revenue, also indicates a new interest from advertisers and sponsors.

Brands today must go beyond simply broadcasting their message; they must beckon the consumer into a conversation. Research consistently demonstrates that customers are more like to purchase a brand or product they have a social connection with. When consumers use digital media to search, shop, blog, socialize, or seek entertainment, their actions create opportunities for marketers to gain insight and gather ideas to improve their brands, marketing messages and media mix choices. Leading marketers are using two-way media such as blogs, word-of-mouth programs, and social networks to connect with consumers as these offer them the opportunity to engage in a dialogue with them.

TV stations can capitalize on this evolution by providing advertisers with innovative platforms where viewers can interact and engage with their brands. TV stations drawing on advanced analytics to present targeted advertising and sponsorship opportunities enable advertisers to know that they are reaching their desired customer demographics. Finally, online and mobile platforms facilitate information collection and analysis, while delivering immediate feedback from an engaged audience, creating tangible value for advertisers.

3. Who’s afraid of the big bad data?

Wow. That’s a lot of data. Not sure what you’re going to do with it? You’re not alone. Better figure it out soon though because that mountain of information is going to determine your business strategy. Ouch.

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Massive amounts of data are being generated by users everyday through social networks, participation in games and other online activities. Recent figures indicate that the number of daily tweets has grown to over 250 million. In March 2012, Facebook was accessed by 526 million users daily. And that’s just the beginning. Users engaging in online games and other social networks and platforms are also contributing large amounts of data every single day.

For the past few years the rise in the data exhaust has left many TV and Media companies with heaps of information and no means to properly capture, explore and exploit it. Companies are looking to shift from monitoring this information (ex. How many likes and tweets does my show get?) to mining the data in order to create business value (ex. Who are the users talking about my show? What are they saying?). They have understood the untapped potential that the data exhaust represents and how unlocking it can support them in spotting emerging trends, being proactive, boosting viewership and increasing revenue.

Targeted insights can be a powerful tool for attracting ad dollars and creating new online revenue streams that will complement traditional TV income. The ability to extract value from the huge pool of data being generated is no longer an option for companies; it is a requirement. Detailed knowledge of viewer demographics not only opens interesting opportunities for advertising but can also be used to shape production and tailor programs to align with the identified preferences and desires of engaged viewers. Going forward there will be additional pressure on digital media teams to have a better command of metrics and KPIs tied to business objectives.

4. CMO: Clearly Must Outshine

It’s not easy being a Chief Marketing Officer these days. Digital marketing is taking over and changing the field completely and expectations are getting higher. No wonder CMOs are calling in the cavalry, but have they landed the pony express instead?

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Nearly seven in ten (68%) global chief marketing officers (CMOs) feel unprepared for the demands of social media marketing, according to a study released by IBM. This is second only to the 71% who are challenged by the explosion in data. A large portion of CMOs also feel unprepared for growth of channel and device choices (65%), shifting consumer demographics (63%) and financial constraints (59%).

The IBM study found that even when respondents were divided into outperforming and underperforming segments, large percentages of out-performers still felt unprepared for many developing trends. On social media, 66% of the best performing organizations feel unprepared for social media marketing with underperforming companies only 4 points behind at 70%.

With increased pressure to drive business value through digital marketing, and in particular social media, CMOs have turned to third party suppliers for support in taking control. Although this has enabled them to better understand, engage with and monitor social media, it has also presented its share of challenges.

The Altimeter Group asked 140 Corporate Social Strategists their total strategy budget, number of full-time equivalent staff dedicated to social media, and organizational model. They identified 18 discrete classes of social business software and services, most of which do not interoperate with each other. Altimeter found that Advanced companies spend an average of $272,000 a year on custom technology development (the second highest spend on social technologies for Advanced companies), suggesting non-comprehensive tools and excessive configuration. Not surprising, only 29% of all companies have standardized internal tools, such as monitoring, analytics, or community platforms.

Disparate tools and technology can be a challenge and there may be no perfect solution, but Altimeter estimate that both for engagement and measurement, the organization needs to decide and go ‘all-in’ on a single tool.


CloudTV is a set of cloud-based and mobile technologies that enable industry players and marketers to address the real opportunities around social TV from content delivery through curation to analysis, making it possible for you to shape the field as it evolves. Oh, and it can help you to lead a revolution in the way you do business.

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