Going digital requires a lot of capital spending, but it allows two or more advertisements to run simultaneously. Photo / Natalie Slade
Going digital requires a lot of capital spending, but it allows two or more advertisements to run simultaneously. Photo / Natalie Slade
The advertising world has gone digital - and not just indoors. Outdoor advertising firms Adshel and iSite are both increasing their digital foothold in the Auckland streetscape.
Adshel focuses on street furniture such as bus-stops, while iSite is offering big digital billboards.
Going digital requires a lot of capital spending, but it allows two or more advertisements to run simultaneously, so it can bring big rises in revenue per site. It can also run ads at specific times to suit individual advertisers.
Adshel has been running about 150 "industrial furniture" sites, with hard-wearing LED digital panels, on Sydney passenger rail.
In the case of bus-stops, because they are close to the road, there are restrictions on depicting movement so they don't confuse drivers.
Adshel is a joint venture between Herald owner APN News and Media, and the US company Clear Channel Communications. iSite is owned by Infratil.
Michael Miller, chief executive of APN, says, "we've seen positive growth in the demand for digital advertising. And in Australia in the first quarter advertising out of home increased by 20 per cent.
"The New Zealand market is probably less developed.
"It actually increases the liveliness and liveability of cities. It's part of the cityscape."
Meanwhile, rival iSite is developing a 124sq m site on an office building in Victoria St West, to open in August, and smaller sites at Khyber Pass and Broadway in Newmarket.
Advertising agencies say the digital move matches trends overseas, but does not reflect a lack of interest in standard billboards.
Wayne Chapman, iSite's chief executive, says the 9m by 3m Khyber Pass and Broadway digital sites will be part of a planned digital network on Auckland's main thoroughfares.
He says digital will make up a greater share of billboard sites.
Camouflaged costs
Video on demand services tend to emphasises their lower price, while not mentioning telecommunications costs, and that's something that might become a marketing issue. On the other hand, broadband costs appear to be falling. Upgrading from ADSL to VDSL, I went from 150 gigabytes to an all-you-can-eat package - not bad for an extra $10 a month. But copper network congestion looks set to rise as people watch more online video. I wonder if I might have to upgrade to Ultra Fast Broadband.
Wishful thinking
There was negative reaction to an item in the
Weekend Herald
last week that questioned global mode - the technology that offers New Zealanders backdoor access to better and cheaper US TV services.
Fans of the service believe they have a right to access content, even though it has been exclusively sold to New Zealand broadcasters. Zealots believe geo-blocking is past its time, and those contracts aren't worth the paper they are written on.
My argument is that - while geo-blocking is on the way out - global mode undermines New Zealand content and the local TV production industry.
Matthew Jackson is commercial director of Bypass Network Services, which with CallPlus is being sued by Sky, Lightbox, TVNZ and MediaWorks, who claim Global Mode breaches their copyright.
Jackson takes the view that open access and the breakdown of geo-blocking will free networks from buying expensive foreign content, encouraging them to focus on local material and offer something unique.
Among working producers I spoke to, however, there are concerns that the loss of ad revenue from foreign content will deprive networks of capital to invest in local material.
Jackson points to Netflix and its own productions in the US - House of Cards, for example - as a sign for the future. In my opinion it would be surprising if Netflix took any interest in local content. The upside is technology's democratising effect on content-making, in the same way that digitisation of news created blogs. But in my opinion, most people will not be happy with low production values. Video content will not be de-industrialised.
It's time for Sky to lose the bloat
Lightbox equals SoHo with shows like Better Call Saul. Photo / AMC
Sky TV chief executive John Fellet has looked several times at turning SoHo into a basic package channel available to all subscribers, rather than a premium channel costing an extra $10 a month.
Sky rejected the idea because people who are not interested in SoHo (whose content is comparatively costly to buy) resent subsidising those who are.
But in my opinion, Sky needs to offer more specific content to counter the much cheaper subscription video on demand services such as Quickflix, Lightbox, Netflix and its own service Neon.
"Bloat programming" is the foundation of the Sky business plan, but in my opinion Sky will have to move away from the notion of requiring bulk basic packages offering programming that people do not watch.
Personal circumstances are a factor.
I have been paying about $80 a month for a basic package plus SoHo and Rialto, but I'm not fussed about basic fare, so I effectively pay $40 a channel per month. They are not worth that.
I've recently picked up free trials for Lightbox and Netflix, and found them useful - shows like Better Call Saul and Wolf Hall on Lightbox are equal to anything on SoHo. However, both Lightbox and Netflix need to improve content.
