CCS Insight Releases its Predictions for 2014 and Beyond
15 November 2013, London, UK — 4K high-resolution video will primarily be created and consumed on mobile devices first, with adoption on TV screens being a secondary measure, according to media and telecoms analyst group, CCS Insight. Its top predictions for 2014 indicate mobile devices, including tablets and smartphones, not TVs, will be the driving force behind the adoption of 4K resolution displays over the next three years.
The increased processing capability and quest for differentiation has meant more and more handheld devices are now capable of displaying a 4K resolution, and represents the growing “mobile first” philosophy of software suppliers, which is prompting a major shift in technology adoption.
Paolo Pescatore, CCS Insight’s director of apps and media, said: “While TV was the driving force behind HD displays, the lower price of sub-10-inch screen devices, with 4K video capabilities and shorter replacement cycles for handheld devices, means consumers can expect to see 4K material being generated by phones and tablets before we see a large market for it with TVs. It’s a further indication of the extent to which the industry is converging.”
The smart TV is also in jeopardy, with manufacturers’ vision for smart TVs expected to fail over the next couple of years. While the presence of smart features on midrange models by 2015 is predicted to prevail, the slower replacement rates for standard TV sets, combined with competition from other connected devices will result in slower uptake from consumers.
In fact, the predictions, which will be presented to customers during CCS Insight’s annual predictions event today, forecast a troubling few years ahead for the media and broadcasting industry. With the use of pay-as-you-go video and TV services, such as Netflix, predicted to rise dramatically next year, some of the industry’s weaker broadcasters are at risk of being forced out of the market.
Here’s an overview of some of CCS Insight’s predictions for the broadcast and media industry:
Several European free-to-air broadcasters go out of business by 2018.
Many broadcasters are struggling to maintain advertising revenue; some are diversifying by investing in original content; while others are making content available on digital platforms for a fee. Showing flagship programmes on Netflix and YouTube offers advertising returns that can be two to four times higher than those for traditional TV. Moves by Internet video providers to launch live TV programming in the next year will be the last straw for some free-to-air broadcasters, and could force them out of the market altogether.
Usage of pay-as-you-go video and TV services will rise dramatically in 2014.
In many markets more than half of households have not signed up to pay-TV services — for some it is as high as 80 %. The next wave of growth is expected to come from video delivered over the Internet, and an array of pricing options will provide users with more options. Many satellite TV providers have already introduced monthly and day passes, and Netflix is introducing family options.
Music streaming providers become the new record labels.
Following the successful model deployed by the video and TV industries, streaming providers will also look to commission original content. This will allow them to differentiate their offerings and help curb high licensing costs, as advertising and subscription growth continues to dwindle.
Apple’s revenue from iTunes, software and services will overtake that of the Mac business in 2014.
A slowdown in Mac sales and the continued growth of iTunes, App Store, iBooks, software and other services will sees the less-tangible part of Apple’s business become its third-largest revenue source behind the iPhone and the iPad. This shift raises questions about the company’s long-term intentions to flip its business model to boost margins through content, services and advertising rather than just hardware.
Amazon will become a significant force in advertising by 2015.
Amazon will build on its trove of purchasing data, including buying histories, reviews and tastes. The company’s margins will improve, and Amazon will expand geographically.
For CCS Insight’s predictions for the device and mobile operator markets, please see here.
About CCS Insight
CCS Insight is a global telecommunications analyst company. It provides comprehensive services that are tailored to meet the needs of individual clients, helping them make sense of the connected world. Follow us on Twitter or learn more at www.ccsinsight.com.
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