Digital opportunities

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Digital communications elude and excite in equal measure both consumers and industry operators. Has the Intellect CE conference managed to unravel this issue? asks Anna Ryland.

This year’s Intellect conference was focused on the concept of digital connectivity in the home – the benefits, challenges and opportunities it presents to customers and industry operators who provide products and services for the ‘connected’ home. The selection of speakers reflected the complexity of this issue, which to a great extent still confuses the consumers in much the same way as the potential of the internet. The attitude of consumers to the internet and digital communication is that of “informed bewilderment” said Maggie Philbin, BBC journalist and the conference chair.

All speakers agreed that the key factor in creating a digitally connected home is ensuring clarity of understanding and ease of use of digital products and services. Using them from the comfort of their homes (termed as ‘sofa moments’) customers will accept or reject them.

The omnipresence of digital communications is exemplified by the extensive network of Google’s services which connects 300 billion pages worldwide with variety of content. The devices that give people access to this vast pool of information are becoming increasingly sophisticated and powerful. “The potential of a connected phone is limited only by imagination,” said Kevin Mathers, industry head, technology, Google UK. Most information can now be captured and in a matter of seconds distributed over thousand of miles – as microphone becomes people’s voice and camera their eyes and they are increasingly keener to share it through social networks.

Meanwhile “radio needs to define where it’s heading, as it’s a strong medium but needs to grasp the digital opportunity,” argued Tim Davie, director of Audio & Music at the BBC. The importance of radio in people’s lives is clear: 91% of the population of listens to 21.8 hours of radio every week. The BBC share of this market is significant: 66% of the UK population listens to 16.5 hours of BBC broadcasts a week, and gives them a high score of 8.1. In fact the BBC commands a 56% share of radio market. Nevertheless the changes to the format and radio technology are inevitable, and future services will have to include FM, DAB and IP technologies. Also radio’s popularity will grow with linking it to different mediums. For example, people listening to a radio broadcast could be directed to BBC film documentary on this subject.

Also, full digital radio coverage in the UK is a must. In 2011, the BBC is going to built 61 new transmitters which should improve the current situation, especially in regard to the motorway coverage. It is expected to grow from 85% to 95% in 2011. Yet, the common standard for DAB radio still needs to be agreed and the radio industry looks to Digital Radio UK to provide leadership on this issue.

Home entertainment of the future

Next Simon Caver, chief executive officer of LoveFilm, explained how this popular subscription entertainment rental business is making the transition to a digital format. LoveFilm is the number one operator in its field in Europe. It specialises in ‘classic film’ rentals, with £500 million income from its rental business and over 67,000 film titles on offer. Its service is fast evolving from disc rental to online rental, and is now taking a leadership role in the digital TV market. This new market opened a wide range of possibilities for both the users and commercial operators. The service, which is now accessed through digital TVs and PCs, will soon be available via Blu-ray players, game consoles and bespoke receivers. The users will not only be able to choose the film and instantly see it, but also be able to see recommendations and reviews of the film on the pages of social network sites such as Twitter.

Therefore LoveFilm now has to decide what form of access to the products (the physical, digital and a hybrid format) to give customers and what channels of communications to use with consumers and potential advertisers.

David Brennan, research and strategy director of ThinkBox – the trade marketing body for commercial television – argued that TV viewing is growing faster than ever – as people are able to see what they want, when they want and how they want. This guarantees maximum viewer’s engagement – a key benefit for advertisers.

The support of online services further enhances the effectiveness of television, as the internet is a response, distribution, promotional and audience building channel. “Digital technology is making TV work in a more powerful way,” concluded Mr Brennan.

Nic du Feu, head of marketing for Mobile Operators Alcatel Lucent, said that the content and format of digital communications is tailored according to the type of device used, among which the mobile phone is fast gaining the leading role. While the TV is a shared device used by the whole family, the PC has advantages of large storage and interactivity, the mobile phone is the most personal of all devices and always available – and increasingly being used as a multi-purpose tool.

The device that can manage the content of digital communications most effectively will have a leading role in the future. However the issue of content management is still riddled with problems, particularly for application providers.

Meanwhile financial editor of the Evening Standard, Antony Hilton, commented on the likely speed of Britain’s recovery from the recession. Analysing the course of previous economic recessions, the government’s handling of them and financial institutions’ response, he concluded that the recovery will be faster than expected, underpinned by a resilient financial sector and the economic power of the leading EU partners.

Finally, Ed Vaizey, Minister for Culture Communications and Creative Industries, confirmed that the government is backing the 2015 deadline for a digital radio switchover. However, before the analogue switch-off is going to take place, DAB would have to reach equal coverage to that of analogue radio. He also said that among the most important barriers to digital radio proliferation are engaging content, sufficient coverage and accommodation of DAB in cars. He concluded that ultimately the consumer will determine the fate of digital radio switchover.

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