By Terence Keegan
There is still a host of issues to resolve in the burgeoning market for “second screen” entertainment — not the least of which is how the various stakeholders in the media and entertainment business are going to make money off this new platform.
So notes Chuck Parker, a former executive for media services company Technicolor, who chairs the newly formed 2nd Screen Society (S3). At the MESA-managed organization’s inaugural event in New York on Tuesday — where more than 250 content producers, developers, and distributors traded perspectives on monetization and other issues — it was clear that while there may be no single formula to producing a successful (i.e. revenue-generating) second screen experience, best practices are emerging among television networks, movie studios, and other content companies seeking to capitalize on the trend.
What’s On ‘Second’?
Among attendees of the 2nd Screen Summit — who ranged from app developers to television producers, cable network executives, and even some representatives from other segments of the entertainment business, such as music — there was little question that consumers already use smartphones, tablets, and/or computers while watching TV. NPD’s Ben Arnold provided the event audience with some fresh datapoints on the emergence of a bona fide second screen market. Among total televisions currently owned in the U.S., 40 percent are capable of being connected to the Internet, NPD claims; what’s more, two in five consumers who own such TVs (40 percent) are actually connecting them. In addition, approximately one in five U.S. households (19 percent) report ownership of a tablet in 2012, Arnold says.
So the demand for second screen entertainment may well be there. But before any company develops (much less monetizes) a second screen app, it is critical to determine what exactly the company views as the “second screen.”
Many in the television business presume a consumer’s living room TV is the “main screen” to which a tablet, smartphone, and/or computer serve as mere companions. But that hierarchy does not necessarily hold for everyone: any device could dominate, suggests Mark Ghuneim of “social TV” data tracking firm Trendrr. In fact, says Pete Deutschman of digital agency The Buddy Group, a consumer’s smartphone could very well serve as the “first screen” for a given app or program.
Content producers speaking at the 2nd Screen Summit demonstrated this diversity of approaches and implementations. Microsoft’s Ron Pessner demonstrated a would-be second screen app for Paramount Pictures’ “School of Rock” movie, utilizing Microsoft’s new : while the movie runs on a TV connected to an Xbox 360 console, viewers can use a “slate” tablet to get biographical information on actors who appear on screen, in real time. HBO’s Alison Moore demonstrated another SmartGlass app for the pay TV network’s “Game of Thrones,” in which viewers could use a tablet to follow plot developments on an interactive map of the medieval series’ fictional world.
Such “companion” apps may seem to be direct descendants of DVD bonus materials. But with tablet screens representing another potential audience “touchpoint,” Moore says, these apps are gaining prominence as means of deepening the audience’s engagement with shows. The greater the audience’s connection, Moore says, the greater their willingness to pay for HBO’s premium service every month.
Live sports producers also focus on audience connection and engagement — but their second screen apps can sometimes represent stand-alone experiences.
Some sports lend themselves to companion-style activity on a tablet, such as checking the recent stats of a baseball player, as MLB Advanced Media’s Joe Inzerillo points out. However, ESPN’s Damon Phillips observes, “not everyone wants to ‘go deeper’ into watching” a particular event. In other words, fans may wish to watch a different game entirely on their tablet than the game — or whatever other program — that’s running on their TV.
What Is The Monetization Model?
“Advertisers drive us to make a commitment to the second screen,” says Peter Scott of Turner Sports New Media. While many executives agreed with Scott’s position, others, like John Douglas of digital advertising delivery company DG, noted that the results of an advertiser’s second screen campaign are still difficult to compare against campaigns on other media.
At present, says Jason Forbes of social TV app Zeebox, advertisers support second screen apps on a sponsorship model. Accordingly, campaign objectives and results can vary widely.
Underlying the advertiser issue is the question of how one quantifies success — e.g., is an audience “engagement” metric more important than the sheer number of impressions?
Paid content providers also face the question of how to define success when deciding how much budget and resources to devote to second screen app development. Jeremy Toeman, founder of app developer Dijit, related the story of a major network spending eight months to build a certain app. Upon release, the app garnered 10,000 downloads and installs, Toeman said; “the question was, did [they] do well?”
While the number may appear objectively small, Toeman observed that the app marked the first time the network had mounted such a campaign to reach consumers. [UPDATE: Dijit had nothing to do with the development of the app from Toeman’s story.]
For any company planning a second screen app, success by any measure would seem to flow by keeping in mind the habits and preferences of the end user. In some respects, the second screen trend is an effort to harness consumer behavior, akin to entertainment companies’ social media marketing efforts. But as Jacob Shwirtz of Viacom Media Networks reminded the audience, “Social media wasn’t invented to be a marketing tool for television.”
The early lesson for companies courting deeper connections with consumers — and ultimately, new revenue streams — on the second screen? Understand the nature of the relationship between content providers and consumers. “I don’t think we look at it as owning” the second screen experience, advises Tammy Franklin of Scripps Networks Interactive. “But I do look at us as facilitating it.”