Think BR: Is Google hammering another nail in YouView's coffin?

By Rhys McLachlan, brandrepublic.com, Tuesday, 03 July 2012 12:30PM

Two new competitors are set to battle for a share of the pay-TV market. Rhys McLachlan, business development director at Videology, says Google represents a real threat to YouView's viability.

Rhys McLachlan, business development director, Videology

Rhys McLachlan, business development director, Videology

Take a look at what sits beneath your TV. Is there a Sky+ box perhaps, a Freeview decoder, a DVD player maybe and possibly even an old VCR to play those films that you love but bought before the digital revolution really took hold.

And now two new competitors are trying to squeeze into that space. First YouView, a ‘Freeview+’ box that also promises access to pay TV services, combined with internet streaming for the likes of iPlayer and Vevo.

This long-delayed device will allegedly be available for consumers from late August, some 24 months after the original launch date.

Secondly, there’s Google’s new Android set-top box. Offering similar services to the YouView device (allegedly…) but crucially, available now rather than after the Olympics

The arrival of connected TVs and streaming services were supposed to clear the clutter beneath our TV sets.

At this year’s Consumer Electronics Show in Las Vegas it was clear that the global electronics manufacturers were all gearing up to sell TVs with all the technology they needed built in.

In years past Google had demoed various iterations of set-top boxes, but in 2012 everything was incorporated, a single screen with all your televisual entertainment needs streamlined to your living room.

Instead we are faced with a rerun of Sky vs BSB and BSkyB vs ONdigital, except for lower stakes. The number of houses that might buy one of these boxes is limited. If you already have a connected TV - and plug it in - or cable then you don’t need on-demand services that these devices proffer.

If you already have Sky or Virgin Media then you are equally unlikely to need additional pay-TV services, as it is likely that your big-screen on-demand services are already very well catered for.

That’s 13m homes that are unlikely to shell out £200-£300 for a new set-top box. So this battle will be focused on the digital laggards and those who are currently dissatisfied with a basic Freeview package but are pay-TV refuseniks.

When chairman Lord Sugar demonstrates the latest YouView technology tomorrow, he’ll know that the platform - backed by the BBC, ITV, Channel 4, Talk Talk and BT among others - is fighting for crumbs.

Except that thanks to the serious delays in developing the YouView technology, the number of crumbs has declined noticeably since the project was first scheduled to launch in 2010.

And now Google is looking to hoover up some of those crumbs before YouView arrives at the party. And by contrast to YouView, its set top box will be available in July in the US and in the UK soon after, just weeks after it was announced.

But Google also brings additional muscle to the party. While YouView is a purely UK initiative, Google brings with it global might.

That means that it will be able to secure both cheaper manufacturing thanks to its global footprint, but also that ultimately, it may well be able to do better rights deals with Hollywood studios and global sporting rights holders.

That might particularly concern YouView stakeholder BT. Having pulled off a coup in securing premiership football rights last week, it now knows that it too faces a new challenger in the broadcast wars.

If Google TV becomes established in UK households then it will have the perfect platform to start to secure the sports rights that BT is relying on to build its subscriber base.

Rhys McLachlan, business development director, Videology

This article was first published on brandrepublic.com

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