Over the past year or so, dozens of TV stations have begun quietly experimenting with technology that can deliver content to Internet-connected TV sets and conventional TVs linked to the Net through Blu-ray players, game consoles, DVRs and specially designed set-top boxes from Roku, Western Digital and others. These over-the-top (OTT) apps promise to extend their brands and drive revenue.
Stations Amp Up Viewing With OTT Apps
KTVU San Francisco is no stranger to pitches from high-tech firms. Right up the road from Silicon Valley, it’s only natural for tech start-ups to peddle their products to the Cox Media Group Fox affiliate.
But when Flingo approached the station nearly a year and a half ago about its plan for developing an app for bringing its local programming to viewers on demand, station execs bit.
KTVU’s so-called over-the-top (OTT) app has been up and running for about a year now. With the click of the remote, viewers can see the seven-day weather forecast, watch a clip of the day’s top news story or highlights of high school football games.
“When we looked at this opportunity, we asked, can this help extend our brand and drive revenue,” said Ed Chapuis, KTVU news director. “We think it can do both.”
KTVU’s OTT service is still in a soft-launch phase, running only on Vizio sets, Chapuis said. After some fine-tuning, he said, it will be launched later this year on more sets and promoted with a heavy campaign. To make money, he said, he plans on running 10-second spots in front of video clips.
Over the past year or so, dozens of TV stations like KTVU have begun quietly experimenting with technology that can deliver content to Internet-connected TV sets and conventional TVs linked to the Net through Blu-ray players, game consoles, DVRs and specially designed set-top boxes from Roku, Western Digital and others.
The number of Internet-connected TVs alone is growing fast. More than four million Internet-connected TVs were shipped in 2010, and another 10.4 million are expected to be sold this year, according to the Consumer Electronics Association.
The current leader in developing OTT apps for TV stations is News Over Wireless [NOW], a division of Capitol Broadcasting, a small station group based in Raleigh, N.C.
News Over Wireless (NOW), which began by developing apps for mobile devices, over the past year has developed OTT apps for 61 TV stations that work on the Yahoo Connected TV platform. The Yahoo platform runs on 70 TV models from Sony, Toshiba, Vizio and Samsung.
NOW partnered with Yahoo initially because it had broad coverage, said News Over Wireless General Manager Sam Matheny. However, he acknowledged the market is fragmented, with set manufacturers making sets that run different platforms.
“That’s what happens anytime that you are dealing with a new technology, ” he said. “Folks are trying to figure out what the right way to go is.”
Capitol Broadcasting’s WRAL Raleigh was the first station to launch a Yahoo app with NOW. Since then, the company has developed apps for all the news-producing stations of LIN Media, Scripps and Meredith Broadcasting, Matheny said. Stations belonging to Bonten Media and Fox and CCA’s KTSM El Paso, Texas, have also obtained apps from NOW. They’re now “partially launched,” running on some Internet-connected sets, Matheny said.
Bonten Media CEO Randy Bongarten likes what he has seen so far. “We’re … getting tens of thousands of page views a month and it’s growing,” he said. “We’re really thinking we’re on the front end of this and in a good position. The opportunities are tremendous.”
LIN Media shares that enthusiasm. “Our vision is to be first in our market with everything,” said Robb Richter, LIN Media SVP of digital media. It’s particularly important to be first with an OTT app because consumers are unlikely to download multiple apps so they can watch more than one station, he said.
LIN hasn’t incorporated advertising yet, but is looking to more heavily market the apps in the fourth quarter when Web-enabled sets are expected to take off with the Christmas season.
Flingo offers customers broad reach — an app that will work with not only many major brands of Internet-connected TVs, but also a variety of set-top boxes.
“What broadcasters really need is a company that really understands all these different platforms and can reach them in one step,” said Flingo CEO Ashwin Navin.
The company has deals in place for its apps to work with Web-enabled sets made by Samsung, LG, Vizio and Insignia. They also work with Google TV, which is on some Sony sets, as well as with Western Digital OTT players, TiVo boxes and some Blu-ray players.
Navin said Flingo has also developed an app for Cox’s KIRO Seattle as well as for a number of other stations that he wasn’t at liberty to identify.
Meanwhile, a few stations around the country have built apps to make their content available through Roku set-top boxes, which are used primarily by Netflix subscribers to stream movies and TV shows. Morgan-Murphy-owned WISC Madison, Wis., and Dispatch Broadcast Group’s WTHR have Roku apps up and running, and Landmark’s KLAS Las Vegas is waiting for technical approval from Roku for its app, a process that could take another two or three weeks.
“We definitely want to get in there and experiment,” said Chris Way, director of digital media at KLAS.
Lee Driggers, IT manager for WTHR, said the station is experimenting with advertising on the platform, which now has about 7,500 users and generates 800-900 video plays a week. “This is still really new for us,” he said.
But the ability to reach consumers through Roku is growing, Driggers said. “Roku, until March or April, was only sold through Roku.com, and sort of techy people knew about it,” he said. Then the company cut deals with Best Buy, Wal-Mart and Radio Shack to sell their devices, “and that changed the game for Roku considerably.”
Other broadcasters are keeping an eye on the pioneers.
“As an industry, it’s important that we start to experiment with what is coming,” said Randa Minkarah, SVP of business development for Fisher Communications. Fisher is developing an app with the intention of conducting a trial in a few markets. “People want to watch TV when and where they want to watch it,” she said. “We are all working to figure out what that looks like.”
Paul Zagaeski, a digital analyst with GigaOM, said OTT apps are not yet a business. “I don’t imagine that TV stations can just count on advertisers throwing money at them to throw [ads] on new devices,” he said. “This is going to be a little bit of a transition period,” during which broadcasters and media metrics companies sort out how best to measure the interactive TV audience, and how to structure the advertising rates.
And until all the pieces come together, Zagaeski said not to expect a proliferation of stations’ offering OTT apps. It’s tough for stations that “have spent a lot of money building a traditional television broadcast environment, and now they’ve got to add on another layer of technology and expertise that addresses the new world of set-top boxes, Internet and mobile,” he said.
“They don’t have a lot of resources to throw at completely reinventing a whole new television distribution system.”