Mobile World Live went behind-the-scenes at Broadcast Centre in London with Ericsson and EE to find out how the worlds of TV and mobile are converging.
Ericsson and EE appear to agree on two things: the consumer, and not content, is king in the media industry, and viewing content, particularly videos, on mobile devices is what the consumer increasingly wants.
This is not least because of the proliferation of 4G and the demands of those in the 16 to 24 age bracket who, according to a new Ericsson study, are most likely to watch TV in bed before getting up, and while travelling to – and at – their place of education/work.
Thorsten Sauer, Ericsson’s head of broadcast and media services, commented at an event last week at the Broadcast Centre that Netflix spends more on content than the BBC does. Indeed, by 2020, 50 per cent of content will be consumed on mobile screens.
As a result of this, “convergence is happening,” claimed Sauer, a prime example of which is BT acquiring premium sports rights and Sky’s deal to gain wholesale access to services over Telefonica O2’s network.
Sauer believes this trend puts Ericsson, a company that has increasingly diversified from being a mobile network hardware vendor first and foremost to one that also provides software and services, in an “interesting position,” and it is obvious that it doesn’t want to be left behind in convergence.
(It is worth noting that software and services, 14 years ago, comprised 27 per cent of Ericsson’s sales. Fast forward to 2013 and 43 per cent of sales came from services and 23 per cent from software.)
Sauer’s viewpoint also echoes the strategy of CEO Hans Vestberg, who last November told Mobile World Live: “A new way of thinking is needed by a company like us… We as a company will need to understand how the networks of the future need to be designed.”
To this end, Ericsson has been acquiring companies to boost its digital media business, such as the broadcast services division of Technicolor, cloud storage company Fabrix Systems and Red Bee Media (through which it provided a captioning service to our own Mobile World Live TV service at the 2015 Mobile World Congress in Barcelona).
Thanks to such acquisitions, Ericsson boasts of “the most complete portfolio in TV,” including content production and services that engage users.
Michael Bjorn, Ericsson’s research head, also used the media tour to talk up Ericsson’s latest TV and media study. One major theme to emerge from the report is the fact that streaming video on demand is slowly catching up to traditional, scheduled TV, and may even one day surpass it.
This is why Bjorn believes “the structure of TV services” needs to be changed to give users a more personalised experience by providing them with suggestions for what to see and aggregating the right content for them, rather than providing a fixed schedule.
The main challenge, of course, is poor network coverage, although 4G is helping remove technical barriers.
Matt Stagg, senior manager of network strategy at EE, elaborated on this at the BBC event by saying that a video distribution network needs to be built that supports communication, rather than the other way around. For this, there needs to be collaboration between everyone in the industry, because everyone’s end user is the same. Stagg namechecked the Mobile Video Alliance, an initiative set up by EE with this ambition in mind.
Stagg said EE wants “LTE Broadcast to be better than TV” with, for instance, live sport streaming that provides a feature rich experience by giving users the option of multiple camera views and multiple replays.
So if the consumer really is the “new king in town,” and what the consumer wants is content on mobile, perhaps that makes mobile royalty too.
The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.