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With Broadband Penetration Rates Breaking All Forecasts Any Newspaper Site Not Using Local Video on Its Web Site Is Already Behind the Times.

In the UK telephone operator BT announced it has reached its milestone of 5 million broadband clients a full 12 months early. In Spain, where broadband usage increased by 200% in 2003 and 64% in 2004, Forrester says broadband uptake this year will be driven by a massive investment increase, and in the US, the world’s largest broadband user, nearly 5 million households upgraded in the past six months.

So with that type of usage upsurge already documented does your media site utilize locally produced video today? Too expensive? Not at all! And the argument that not enough people are out there to take advantage of the video investment is long-gone.

As newspapers switch to a multi-platform business model it also means they must add to their web site all the advantages that multimedia can bring – and that means within one envelope providing the text, the still pictures, perhaps the news graphics, and also the video of any given event. And some newspapers are even experimenting with podcasting – an audio online broadcast of their content.

With an all-inclusive product like that, why would anyone wanting the full local news story look anywhere else but that local web site? And broadband services draw broadband advertising, at a premium.

International news agencies have video products tailored for international web news pages. Even national news agencies like ANSA in Italy and the PA in the UK have national video products to go with their complement of national offerings. And there is no reason why a newspaper cannot add that same type of video to its own local reports.

Just how simple can it be? The UK Press Gazette in a recent article described how a PA journalist, using a simple studio system that does not need any additional staffing, records his piece for camera:

“Using a laptop, he selects the images on the bank of 16 screens that will appear as his backdrop, and then walks around and sits on a stool in front of a camera. Using a remote control, he tilts the studio camera until he’s happy with the angle of the shot, which he can see in a monitor in front of him. A foot pedal on the floor allows him to control the autocue for the script that he’s just written. He presses the button and begins recording.”

It can be as simple as that.  And for a local reporter covering a local event even with a small cheap electronic camera adding that video to a web report can mean all the difference in the world.

As even the big international TV networks have learned, it’s not so much the quality of the picture any more, but rather do you have a picture at all. There was a time not that long ago that a TV network or an agency video provider would not even touch something that was not of studio quality. But then came satellite video telephones that allowed access to places where no satellite dish was available and the message soon changed to it was better to have that poorer quality than no picture at all. And on broadband that same philosophy applies, although in actual fact with a good broadband connection the video is very acceptable. .

And is there really a broadband audience today?

BT, in reaching its 5 million subscribers a year early said its pace in Q1, 2005, was equivalent to installing one broadband customer every 10 seconds of every day.

Manchester United, the most famous football team in the world, has its own broadband TV service and now Chelsea, the new English Premier League champion has announced it, too, will have its own broadband service.  Even the Scottish city of Glasgow has announced what it claims to be the world’s first city-produced 24-hour broadband television channel.

Television companies such as CNN and ABC in the US  are looking at new models for their video services online. CNN, for instance, recently announced it will switch its current paid broadband video service into a free, advertising-supported service. What does CNN know that others don’t except that broadband is prevalent enough, the cost of transmission now cheap enough, and that the advertising model that has worked so well on the rest of their web news site can now work for video, too.

According to eMarketer, on sheer numbers the largest European broadband markets are France (6.1 million installations representing 23.1% of all households), Germany (5.7 million representing 14.8%), the UK (5.6 million representing 23.1%) and Italy (3.8 million representing 17.0%).

But when looked at as a percentage of household penetration, the list looks quite different. The Netherlands leads Europe with a 41.3% penetration, followed by Belgium (37.3%), Denmark (36.1%) and Switzerland (33%).

Asia holds the world’s top three penetration positions with S. Korea the leader at 73%) followed by Hong Kong (59.1%) and Taiwan (50.8%). The US, leader in total installations of 34.3 million, comes in 11th in terms of penetration at 29.9%.

According to Ben Macklin, senior analyst at eMarketer covering the broadband industry, “There are three important success factors common to leading broadband markets across the globe – availability and choice, price, and government support.”

And in your local market how can you tell if broadband installations will really take off?  As a rule of thumb according to eMarketer, if the cost of broadband is down to about $1 a day ($30 monthly) for a 1Mbps connection, then expect widespread adoption.

The smart publisher will find out what broadband connections cost in his market, and will be encouraging local broadband vendors to lower their cost to increase adoption. When the cost is down to the equivalent of $1 a day then the newspaper’s web site had better be ready to stream video before someone else steals that thunder.

One last point. According to the Bandwidth Report broadband penetration is most prevalent in those communities where the young affluent live. Isn’t that, after all, the very demographic advertisers seek, and the very demographic newspaper publishers are trying to win back?

© Philip M. Stone of  Stone & Associates, a partner in followthemedia.com


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