Challenges of Digital Innovations: A Set-Top Box Based Approach

Abstract

Partly thanks to the massive breakthrough of broadband internet as a distribution highway, the convergence of telecommunications, information technology and media has brought us to radical changes of media markets: challenging services are launched, traditional value chains are broken, new value constellations arise and innovative — but often unproven — business models are explored. Compared to other mass media, (commercial) television broadcasting is most affected by these mainly technology-driven developments due to its high dependence on advertising revenues (Doyle, 2002). As new media services — especially online and mobile — allow for personalized and direct response advertising, they are grasping a growing share of advertising resources. In broadcasting, the rise of digital television platforms should be mentioned, as well as the ever-growing success of ad-supported online video services such as YouTube and Hulu. This enduring pressure on advertising revenues has moved broadcasters to rethink strategies for connecting with viewers, which results in multi-screen distribution and a shift towards subscription-based revenue models (Evens, 2010). If advertising is to remain the major funding source for private (as well as for some public) broadcasters in the near future, there is a need for a better understanding of viewer behaviour and innovation in television audience measurement techniques.