I LOVE GOING TO confabs like NextMedia. As Telus’ SVP Michael Hennessy tweeted earlier this week: “Finished 2 days at #nextMEDIA looking to future of digital media. No discussion of #FFC, #CRTC. Met real digital entrepreneurs. Awesome.”
Hennessy told me Monday at that conference that when it comes to the debate over value for signal for over the air broadcasters, he’s done. Telus won’t be appearing at next week’s hearing into the issue, the one ordered by the feds.
Indeed, two days at NextMedia (built off a backdrop of my four days in Denver at Cable Connection Week in October, where the U.S. digital media market is well ahead of Canada – and also much more open and active) shows that while the Canadian TV industry is arguing over yesterday’s model, the consumer has moved on – and is moving on – to other things.
“Boy, we’re behind,” said OpenText executive chairman and chief strategy officer Tom Jenkins, about Canada’s media market during his NextMedia presentation. Waterloo’s OpenText is one of the world’s leading enterprise content management software companies. It works with media and telecom companies, as well as energy, packaged goods, automotive, and aerospace companies, among others. Its software manages content on a scale the Canadian cable, radio, television and telecom marketplace can’t fathom, serving 50 million users in 114 countries.
“So much of our discussion is within Canada… (T)he artificial barriers to keep the barbarians out are not going to stand with the Internet,” he added, just after pointing out how the loosening of telecom ownership rules in Europe lead to huge growth in competition.
The “insular” conversations we’re having here about Canadian culture and protecting certain industries are not happening anywhere else in the world, said Jenkins. People and companies elsewhere are going digital as fast as they can, meanwhile “1% of what makes us Canadian is in digital from analog,” he added.
That means kids and others – who are online in droves in Canada – generally point their browsers south.
“It’s not about the CRTC or TV or broadcasters,” he added. People should be concerned about going digital as fast as they can because that will lead to growing GDP, wealth creation and a stronger country, Jenkins explained.
The next day at NextMedia, Kaan Yigit, founder of research firm Solutions Research Group, backed up what Jenkins had to say on how consumers, especially “millennials” or the 12-24 year olds, are changing – and that national borders don’t mean much when it comes to communicating and entertaining themselves.
For example, they don’t turn the radio or TV on first in the mornings like they used to. They log on to Facebook with their laptops or flip open their phones.
In SRG’s most recent Digital Life Canada research, 61% of those aged 12-24 report a computer in their bedroom and 63% have or use one in the family room (8% report usage in the bathroom. Ew.) And, the number of homes with three TVs or more has fallen off 10 points to 47% in three years, meaning television sets are being replaced with something else, or no longer needed.
Add their iPods and video capable smart phones to the TVs and laptops and the 12-24 year old population is “surrounded by video screens,” said Yigit. And that means that while the TV is on, they may be engaged with their music or texting on their phones, oblivious to what’s on their largest screen, over in the corner.
“It’s really more about the attention or engagement as compared to the time spent,” he added. Fifty-two percent of the 12-24 group report watching TV with a laptop almost all the time.
And, while videophiles may hate hearing this, that group doesn’t much care about the quality of the picture, as long as they can get what they want rightnow. “Choice trumps fidelity every time. Instant trumps fidelity every time,” said Yigit.
So after these two days at NextMedia, knowing what we all know about the rest of the world and knowing how consumers’ habits are irreversibly changing, the CRTC has now been forced by the government to hold another hearing into whether or not analog, linear, broadcasters should get more money.
Whoa. When you put it like that, “boy, we’re behind,” to repeat what Jenkins said.
But, having read a small percentage of the CRTC submissions from regular Canadians, I’m hopeful next week’s hearings will show just how far ahead consumers are in their media consumption patterns (and we’re sure to get an earful on how they pay too much for TV already and that they want to buy channels one at a time) and realize if we don’t alter our system soon, they’ll just keep on finding ways around it, to the detriment of everyone.
Perhaps that will force local and national broadcasters to innovate more. We know people want their local content. Carriers should acknowledge that more. Canadians love their local TV. They need it. But they don’t want to get it the same way it’s been done for half a century.
Canadians want more. They want it better. They want it now. And it’s beyond time that all sides of the industry really work together to figure out how their media companies are going to meet those demands before they are utterly disintermediated.
