Digital TV innovations: industry and user perspective

Different promises and expectations accompanied the introduction of digital television. For users, the introduction of iDTV would lead to consumer empowerment by offering viewers more choice and control via new affordances such as interactivity and on-demand services (Van den Broeck, 2011). From the perspective of the advertising sector, expectations were that the end of the traditional TV-advertising model that evolved around 30-second advertisements would be abandoned and replaced by new advertising formats (Jaffe, 2005). The introduction of iDTV also created new roles in the TV-value chain for both new and established players (e.g. telecom operators become content aggregators as well as gatekeepers).

Because commercial television is organised as a two-sided market, audience behaviour and industry dynamics influence each other. As Peitz & Valletti (2008) described it: "Viewers are interested in programming with little advertising; hence advertisers exert a negative external effect on viewers. Conversely, advertisers are interested in a large number of viewers; hence viewers exert a positive external effect on advertisers". Therefore, we will focus on how innovative strategies take users into account. On the one hand we will look at how the different stakeholders in the TV value network implement user behaviour. This research question focuses on how the perception of industry players concerning users might have changed, but also on resistance from the industry side to change these perceptions, stemming from a lack of knowledge or a lack of measurement possibilities. On the other hand we will focus on how users perceive traditional advertising and new advertising formats (e.g. personalised advertising, interactive advertising). The applied research method is a combination of expert interviews with different actors in the TV-sector and qualitative user research on viewers' expectations towards advertising and new advertising formats in a digital era. We will focus on Flanders (Belgium) as a case [1]. The Flemish television market is a special case within Europe, as there is a high loyalty of Flemish television viewers towards the main broadcasters: 78.5% of the market share (based on linear viewing and time-shifted viewing up to 7 days after the broadcast) goes to the three largest local broadcasting companies: VRT (public broadcaster), Medialaan (commercial broadcaster, former VMMA) and SBS Belgium (commercial broadcaster) (VRM 2013:160-161). The Flemish audience is therefore less fragmented in terms of intra-media fragmentation [2] (Napoli, 2008) compared to audiences in other EU countries. This provides us with a unique situation in the television market.
Today, a decade after the introduction of digital television in Flanders (Belgium), we notice that not all expectations were met. Concerning the implementation of user behaviour in industry, we see that the Flemish TV industry has experimented only sporadically with new advertising formats (e.g. interactive advertising and walled gardens on the television screen itself, interacting with commercials through a second screen device, product placement). Concerning TV-advertising, the main format is still the traditional 30-second spot. Viewers do have more choice and control, as 86% of the Flemish population has an iDTV subscription. Yet, at the same time 56% of viewers still watch linear TV everyday (Digimeter, 2013). Therefore, the Flemish case could provide an interesting basis for investigating changes within the television industry related to customer ownership, inter-media audience fragmentation [3] and audience autonomy.

In the following sections, we first describe the research methods used in this paper. Then, we look at customer ownership, (inter-media) audience fragmentation and audience autonomy as important concepts in understanding innovation and strategies within the Flemish commercial TV sector and how user behaviour is implemented.

Trefwoorden:Innovation, Digital TV, Commercial Broadcasting, Audience Commodification, Stakeholder analysis