Fi, PuhuTV, BluTV and Originals content

One of the most popular local TV series of this season on Turkish TV industry was ‘Fi‘. It was simply a drama but also unique due to a number of reasons. First of all, it was a series available ONLY online as a OTT content but not broadcasted in the classical sense.  Even though this is quite common in US like examples of many Netflix Originals, it’s quite rare that a TV series with a remarkable budget level like ‘Fi’ is not broadcasted all over Turkey but only available through a OTT service.

At this point, I’d better give a quick background information about the service that owns ‘Fi’. The OTT service is called PuhuTV. It’s backed by a major broadcaster group in Turkey, Dogus Media. PuhuTV has been launched commercially early this year as a free-of-charge, ad-based catchup TV service hosting major TV series from a variety of channels. In order to create an awareness in the market and make some noise, they’ve made a sensational launch for their first and for the time being only ‘Originals‘ content Fi. As there is no Live TV channel offering on PuhuTV, the commercial launch event has been publicly available on YouTube TV. At launch night, the first 3 episodes of Fi has been released. As a matter of fact, producing original content like Netflix or Amazon Prime Video is doing in US is already done before by BluTV which is another OTT service. BluTV is owned by one of theTurkey’s major TV broadcaster Dogan Holding. As of today, there are 3 original, exclusive content on BluTV. On top of these, Netflix Turkey is also working on a brand-new local Originals nowadays specific for Turkish market.

Coming back to the popular TV series Fi, it was not made available all at once, but along a series of weeks unlike the Netflix /Amazon Originals. Typically all the episodes of a OTT type of TV series’ new season are made online on the commercial date which is announced earlier. Then, audiences are looking forward the launch date and watching many episodes in a row once they are available. (i.e. Game of Thrones of HBO, House of Cards of Netflix) Unlike the typical scenario, even though the first 3 episodes of Fi have been made available online in April at the launch event, Fi fans had to wait another few weeks in order to watch the remaining episodes. PuhuTV had relased remaining episodes one by one every week. Eventually, the last episode was online on 16th of June as the season final. I’ve thought about the reason whyPuhuTV management decided to release the episodes over the course of 2-3 months instead of making the complete set of episodes of Fi made online at once,

Even though BluTV and PuhuTV are similar OTT services there is a significant difference between them. While BluTV is a subscription based service, PuhuTV is a free-of-charge, ad-based service. That’s why PuhuTV had to wait the rating results of the first 3 episodes. The result was really impressive. According to the results that has been shared, the first 3 episodes have been watched a total of 3,5 million views within the first 50 hours. For the advertisement agencies, this is the most critical KPI that they care. That’s why PuhuTV management should have first waited to get these results in order to convince the advertisers more easily.  Following the fascinating results of the first 3 episodes which were basically missing ads, we’ve seen many ads as in the form of product placement (embedded into to the content in a relatively natural way). Actually, for a service that is free-of-charge the audiences are more tolerant to ads.

It remains to be seen if this ad-based model will be sustainable in Turkish market. By nature, Turkish TV sector is quite competetive and dominated by more than 500 FTA channels broadcasting  via satellite with a country-wide penetration of more than 70 percent.

 

"Digital Platforms" course midterm exam in Kadir Has University, Istanbul

I’ve been teaching a course in Kadir Has University Istanbul/Turkey at Communications Faculty, New Media department. This semester is the 3rd time I’ve been teaching the course called as “Digital Platforms“.  Every semester, there is one midterm and one final exam. If you like you can see the exams of earlier years herebelow.

This week, we had the midterm exam for this semester 2016 Fall. I’ve copied the questions and potential answers as below.

KADIR HAS UNIVERSITY

NM 423: DIGITAL PLATFORMS

FALL 2016 MIDTERM EXAM

  1. Pay-TV platforms:

a.) List down all the pay-TV platforms available in Turkey together with number of up-to-date subscribers? Also you should mention about the media they are using (satellite, IP etc.) (10 points)

  • Digiturk (Satellite) : ~3 million subs
  • Teledunya (Cable) : ~1151K subs
  • D-Smart (Satellite) : ~925K subs
  • Tivibu (IP+Satellite) : 545K subs
  • Turkcell TV+ (IP): 303K subs
  • Filbox (Satellite) : 35K subs

b) Considering the new Football League Broadcasting rights tender that will take next week which one is more likely to win and why? Please explain with solid arguments. (10 points)

As I’m currently a Turkcell employee, I’d prefer not to comment on this hot topic in order to avoid any misinterpretation 🙂

  1. OTT-1 : If I were somebody totally unfamiliar with the term OTT (Over-the-top) TV, how would you explain to me what it is and how it has changed the TV industry as a whole? (20 points)

OTT TV could be defined as the delivery of video content over the open internet without the involvement of any telco in the control. OTT TV has changed the TV industry in significant ways.

It allowed content providers/aggregators to deliver their content/services directly to end users. As opposed to the legacy cable or satellite businesses where the Pay-TV operators needs to make a significant amount of investment, OTT TV providers don’t need to have their own infrastructure. They don’t need to worry about scalibility. They are simply benefiting from the existing pipes of legacy telcos which enabled them to achieve very fast Time to Market periods. As a result, end users had a variety of alternatives on top of old DTH services which lead the new concept of ‘cord-cutters’. Incumbent DTH and cable operators first saw OTT TV providers as a threat. They then started increasing to lose customers. On the last few years they started to see them as potential partners to enrich their content offering.

  1. OTT-2: Globally who is the greatest digital video platform? What makes it the greatest one? What are the competitive advantages compared to the other alternatives? Please explain with solid arguments. (20 points)

Obviously YouTube is the greatest digital video platform in the world. Every minute 60 hours of video is  uploaded to YouTube. Even this simple data tells us about the variety and richness of YouTube’s content portfolio. YouTube who is a Google company comes as an native application on Android phones.  Hence, it has a dramatic competitive advantage in terms of engagement compared to the other alternatives such as Vimeo, Dailymotion etc. Also YouTube is accessible from a lot of consumer electronic devices which serves as another booster to customer interest. YouTube has lots video channels that users could subscribe to and in return generate revenue for the content owners based on the number of views. This allowed content providers to create their own ecosystem that is constantly growing. YouTube which its ever evolving User interface provides a nice, simple and convenient user experience which is consistent through all different devices. Today YouTube allows content providers to upload 4K, 360 VR and even HDR contents and simply the most advanced digital platform.

  1. Netflix: There are lots of OTT services available in Turkey i.e. Tivibu, DigiturkPlay, BluTV etc.  Among these Netflix has a unique position? What makes Netflix so special? What are the competitive advantages compared to the other alternatives? Please explain with solid arguments. (20 points)

There are a certain number of reason why Netflix is special. First of all, it’s the only global SVOD service . Thanks to having tens of millions of active users Netflix could collect user data from all over the world and benefit those for constantly improving the user experience it’s delivering. It’s far beyond the competition in terms of recommendation engine and personalization.  Additionally, it’s hosting Netflix Originals content. In other words, it’s beyond a content aggregator, it’s producing content. (House of Cards, Narcos etc.) Netflix has a superior technology that is allowing to deliver enhanced video quality coupled with its own CDN infrastructure. Netflix is available on a lots of consumer devices which increases the engagement of its subscribers significantly. It’s one of the global lovemarks whose bandwidth usage in USA is more than 37% at peak times. It’s content library in Turkey is hosting more than thousands of TV shows and movies. Having said all those advantages, it’s a known disadvantage. It doesn’t offer neither Live TV nor premium sports content unlike Digiturk etc.

  1. Smart TV: There are a number of popular Smart TV brands on the market i.e. Samsung, Sony, LG, Arcelik, Vestel etc. Some of the Pay-TV operators (Digiturk , Tivibu etc.) are also offering Smart TV applications as an alternative to STB solution. Nevertheless, what we are witnessing is there is no real success story on the market. What are the main reasons for this? Why Smart TV app of Pay-TV operators did not attract huge interest, why they are still deploying STBs? Please explain with solid arguments. (20 points)

The main reason is the lack of internet connectivity of the Smart TVs. Typical Turkish audiences is seeing TV sets as big monitors rather than expecting the similar level of smartness like mobile phones. If Smart TV is not connected or the internet connection is not reliable it’s not feasible to deliver a service-grade TV service to paying customers.  Secondly, there is a huge amount of fragmentation on Smart TV space. There are lots of different TV brands most of them having their own technology stack and dependencies. Also the average life cycle of Smart TVs are around 7 years which makes it quite inefficient to maintain old legacy TV platforms. In general, Pay-TV operators are willing to design and deploy their own unique user experience (with well defined, tested UI and remote control). However,  Smart TV apps mostly depend on the performance and limitation of TV sets which is very complex to keep under control. The overall experience is defined mostly by the Smart TV manufacturer. Lastly. if any customer happens to experience a major issue regarding the service quality or for various marketing reasons, operators would like to manage the customer device (ideally remotely). This is relatively easier to handle with STBs instead of TVs designed and produced a 3rd party.

Netflix Turkey Launch Aftermath

Netflix has launched its service in Turkey together with localized UI and dubbing/subtitle support in 21th of September.  Netflix CEO Reed Hastings was himself also present at the launch event. Webrazzi, a local techno portal has made an interview with him, you can watch it here.

Together with this launch the importance of localisation has been validated to be key one more time. As a matter of fact, Netflix is accessible from Turkey since January 2016 just like the rest of the world. Nevertheless, the ranking of the download of Netflix app has been decreased to more than 500th row around the beg of the year. Then, on Sept, the UI of Netflix has become available also in Turkish, 80% of the catalog has been Turkish subtitled if not dubbed, Finally the cost of service has slightly decreased and the currency of payment has been changed to Turkish Lira from Euro. Following these 3 major changes, the iPad app download ranking has boosted from 500+ to top 50 as seen on the graph below.

57ffe953dd0895e3338b4adb-425

On the other hand, one of the most debated topics was how widely is Netflix content available in Turkey. Let’s have a look details of this. On this link, one can see how much of percentage of the Netflix content in USA is available on various geographies of the world -while keeping content in USA as 100%.- Based on this source, one can access to 25% of the Netflix content in Turkey on TV shows space, while 10,65% of the movies content. The same ratios are around 50% in Ireland 40% in Finland and 30% in Germany. Netflix made a very sisimilarocal launch in Poland around the same time in September. In Poland, more or less the same level of content is available like Turkey.

In short, it’s a fact that Netflix Turkey could not offer the same level of content depth as Netflix USA. But still it’s not far if compared to the most of the countries in Europe. Considering, it’s simply a matter of content rights clearance I don’t see this as a blocker issue as this is core competence of Netflix. If the customer base in Turkey is growing fast, I have no doubt Netflix will continue investing here and making more more content available to Turkish audiences.

The global overview of Turkish Pay-TV Market as of Q4 2014

Turkish Regulatory Body in Telecommunications Industry (BTK) has just announced the market figures for Q4 of 2014. You can download the complete report hereLet me make a quick summary of the figures of TV space.

  • Number of TTNet IPTV (Tivibu) service has become 289.496 as of Q4 2014. The same number was 286K one year ago as of Q4 2013. There is clearly a slow down there. The increase in number of subs has stopped during past year. Perhaps it’s because of the high churn rate.
  • The number of customers in Turkcell Superonline IPTV (Turkcell TV+) service was 15.270 in Q3 2014. As of Q4 2014, it has reached 60.000. There is big growth here. A customer gain of 45K in just one quarter is clearly a big big step forward.
  • The number of Turksat Kablo TV customers is around the same level since long tiem. It’s a total of 1.176.126 as of 2014, quite steady since a few quarters. The table below is self-explanatory. A government officer tolda that Turksat is one of the state-owned companies which is planned to be privatized within this year. This could be one of the reasons why there is not much happening in Turksat. Nevertheless, the installed base over 1 million is quite interesting. I’m pretty sure that there will be plenty of companies who will get interested in Turksat acquisition. 

Capture

            • Number of subs of Digiturk as of Q4 2014 is 2.942.643. The greatest player of the market is still significantly ahead of the market.
            • D-Smart had a customer base of 1.048.960 in the same timeframe. D-Smart is apparently losing momentum. It has lost major sports content to Tivibu lately.
            • The youngest player of the industry Filbox has just 3125 customers after 2 quarters of the launch. The value prop is selling a CAM module and paying 1 year subscription fee in advance and having access to about 20 premium Live TV channels such as SinemaTV, Da Vinci Learning, English Club TV etc.

If one looks to the global picture, the total number of subs in Turkey is around 5,5 mio as of end of 2014. Considering the number of total households is 18 million, the Pay-TV penetration rate is a bit higher than 30%. As a matter of fact, there is no much progress regarding the penetration rate over the past few years. Actually this is not much surprising because except Turkcell TV+, none of the player could manage to make significant growth over the past years. This rate is still not good enough compared to the European countries. I deeply believe that there is a huge potential for growth in Turkish pay-TV market. The key thing is to formulate the right pricing, value prop and content offering. That’s the challenge the management teams should overcome. Once this has been succeed, the level of 40% penetration is realistically achievable in a few years ahead. 

Last but not least, the updated market share of the Pay-TV players is as follows;

Untitled

Broadcasting Rights of Turkish Basketball League

Turkey Basketball League games will be broadcasted by Digiturk and free-to-air sports channel NTV Spor for 3 years starting from 2015-2016 season.

ntv-digiturk-basin-toplantisi-turgay-demirel-20141224

To recap: The split of sports content digital rights in Turkey is as follows:

  • Digiturk: Turkish Premier Football League, English Premier Football League, Turkish Airlines Basketball Euroleague, Turkey Beko Basketbol League, Russian League, Brazilian League, Wimbledon and ATP1000 Masters Tennis
  • D-Smart: Spanish Premier Football League (La Liga), NBA TV, Formula 1, Motor GP
  • Tivibu: UEFA Champions League, UEFA Europe League, France Ligue, Italy Seria A
  • Teledunya (Kablo TV): No exclusive content
  • Turkcell TV+: No exclusive content

Digiturk was already the official broadcaster since past 6 years. With this new announecement it will continue for another 3 years.

It’s been made public that the contract fee is 12 million Euro / per year. While Digiturk will be broadcasting 2 games per week, the other shareholder NTV Spor will deliver another 2 games every week. Considering the enormous fee paid (321 Million UDS + VAT) for Turkish Premier Football League by Digiturk, 12 million Euro sounds pretty cost effective.  Although Digiturk managed to reduce the total cost around by half, it had  no more the exclusive rights which might cause customer churn in return.

iTVF (İstanbul TV Forum and Fair) is coming….

İstanbul TV Forum & Fair will take place in Halic Congress Center, Istanbul in 12 -13 -14 June 2014 for the second time.

Basically, it’s an event where the key components of the content and broadcasting industries gather under one roof, with participation from companies, associations, public institutions, broadcasters and online platforms from all four corners of the world. The event took place with the Main sponsorship of Turksat, Corporate sponsorship of ATV and Supporting sponsorship of Samanyolu Broadcasting Holding with the participation of 53 companies, as 157 brands were represented at iTVF. The event is organized by RATEM (Professional Union of Broadcasting Organisations)

You can find the final report of iTVF 2013 here.

 

forum_programme_itvf_2014

Last year, the first event could not collect many people partly due to the #geziparki protests partly due to the fact that the event is organised for the first time.

This year, iTVF has much higher expectations. Let’s hope that the number of audiences will increase compared to 2013 and everybody will go back home with lots of new connections.

If you need assistance to arrange meetings with local prospects or new contacts just drop an email to info@turkishtvmarket.info.

 

 

 

FINAL EXAM QUESTIONS (SPRING 2014)

I’m conducting ‘New Generation of Television: TV 2.0′ lecture at Kadir Has University Istanbul. Herebelow you will find final exam questions of 2014 Spring semester.

   KADIR HAS UNIVERSITY

CF 432: DIGITAL BROADCASTING

    SPRING 2014 FINAL EXAM

 

NAME  / SURNAME:

NUMBER:

  1. Strategic thinking: There are 5 big pay-TV operators in Turkey; Digiturk, D-Smart, KabloTV/Teledünya, Tivibu, Turkcell TV+.  What would be the acquisition/merger scenarios that would reshape the competition landscape and change the market shares? Why? Please defend your thinking with solid arguments.

          (You are free to imagine hypothetical cases.  Any acquisition/merger scenario is possible.) (20 points)

  1. Smart TV: This is a typical back panel of a Smart TV. Explain the name and functionality of each output?  (20 points)

Back panel

   3.  User Experience: Design and develop an imaginary TV- human interaction that will significantly improve the user                experience.  Please write down how it will work and what are differentiating features with your own words.  (20 points)

   4. Chromecast: Last summer Google announced this brand-new product. It has been a real success and Chromecast is          now available in many European countries in addition to North America. This little dongle product has 2 major features that        differentiate itself from the similiar products (i.e. Apple TV, Rokubox) in the market? What are those 2 features? (20 points)

  5.  Please order the following items in terms the delay compared to the appearance in cinema in increasing order?(10 points)

   DVDKanal D Tivibu Kirala IzleDigiturk Moviemax

6. What does an exclusive content rights mean? Please explain with your own words? (10 points)

GOOD LUCK!

TV dunyasinda haftanin one cikan gelismeleri (w26)

Bu haftadan itibaren global TV sektorunde haftanin one cikan haberlerini/gelismelerini kendi perspektifimden kisa kisa ozetler seklinde paylasacagim.

turkcelltv-arcelik-1-1024x538

  • Once reklamlar 🙂 Turkcell TV Arcelik, Beko ve Grundig marka TV’ler uzerinden erisilebilir hale geldi. Konuyla ilgili Tivilogy.com’da yayinlanan haber bu baglantida.
  • Ingilteredeki duzenleyici kurum Ofcom, UK Pay-TV servislerinin sikayet oranlarini acikladi. Buna gore BT Vision en cok sikayet oranina sahip onu Virgin Media ve Sky takip ediyor. BT Vision yilin ilk ceyreginde 1000 musterisinin 0,29’undan sikayet almis. (10000 musterinin 3 tanesinden) Sikayetler genel olarak servis kalitesi ve faturalandirma etrafinda toplanmis. (Haber linki)
  • Spor kanallari HBO Go ve WatchESPN artik Apple TV’de(Elbette Turkiye’de gecerli degil). Apple TV essiz bir content aggregator olmak yolunda hizli ilerliyor. Simdiye kadar yarisi son bir yilda olmak uzere toplam 13 milyon Apple TV satildi. Ne rakam ama!
  • Ouya adinda yeni bir oyun konsolu son gunlerde sektoru salliyor. Ouya basitce Android’in ozel bir surumu ile calisan bir oyun konsolu. Xbox ve PS yoneticileri pek de rahat gunler gecirmiyor olsa gerek. Ouya 40 tanesi exclusive toplam 178 oyun ile lanse edildi ve fiyati -siki durun- 99 $. Bu yeni oyuncaga goz atmak icin soyle buyrun : http://www.ouya.tv/
  •  Smart TV’lerin yuzde kacinin online oldugu ile ilgili tartismalar uzun suredir devam ediyor. Cogu insanin TV’den bekledigi sadece televizyon ozelligi oldugu icin bu oran pek de yukselemiyor. Bu Haber linki nde de gosterildigi uzere Fransa’daki 3 milyon civari Smart TV’nin ancak %20’lik orani online imis. Turkiye’de durumun da benzer oldugunu dusunuyorum.
  • Avrupa’da UK, benim TV teknolojilerinin adaptasyonu, pay-TV pazarinin olgunlugu, saglikli reakabet sartlari ve icerik kalitesi olarak uzun zamandir cok begenerek takip ettigim bi pazar. Bircok konuda isin dogrusunun ne olmasi gerektigini basariyla ortaya koyuyor ve gerekli uygulamalari hayata geciriyorlar. BBC basta olmak uzere, duzenleyici kurumlarin da cok saglikli calistigi asikar. BBC, yine cok isaberli bir ise imza atmis, http://www.thefutureisconnected.co.uk/ adresinde  TV’leri internete baglamanin yollarini izah ettigi, yol gosterdigi bir site acmis. Ayrica sitenin tasarimi da cok cool. Turkiye pazari icin de benzer bir tanitim kampanyasinin idealde TRT tarafindan yurutulmesi gerek. Aksi durumda Smart TV ureticilerinin, OTT servis saglayicilarin oyun alanlari giderek daralacak.