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  • Published on: 14th September 2019
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MKTG5006 Marketing Intelligence and Research

Unit Coordinator: Russel Kingshott

Project Brief

Strategies to Combat Australia's Oversaturated SVOD Market

By Paige R. Nagle (19586405)

Abstract

Online article, CBS confirms Australian streaming platform to launch by the end of 2018 (Idato 2018) outlines a key business problem that will impact Australian consumers directly (Appendix A). The direct issue faced is the oversaturation of Subscription-based Video On Demand (SVOD) services in Australia, with the announced launch of CBS All Access. This is of concern for all SVOD service providers as an oversaturated market makes for difficult and direct competition for the attention Australian consumers.

Further diagnosis of this problem has been developed to better understand the viewing habits of the Australian society. Specifically looking into how different ages, genders, and backgrounds interact with SVOD services whilst monitoring consumer viewer habits. This allows for CBS to determine the best entry strategy to successfully enter into the Australian market.

Summary of the Article

American mass media company CBS have announced their plan to release a new VOD service, CBS All Access via their acquisition of Network Ten, as a “gateway to launch into the market” (Associated Press 2018 para. 6; Idato 2018). This provides a competitive outlook for VOD service providers in Australia, as the market is already filled with popular subscription based services like Netflix, Stan, and Foxtel Now (Idato, 2018).

CBS hopes to launch the service by December 2018, however many other Australian broadcasting services already own content by CBS (Idato 2018). Therefore it is unclear if CBS All Access wil provide enough unique content to provide a strong enough difference to survive in the Australian marketplace, as consumers of SVOD already have multiple services to cover a variety of shows (Screen Australia 2017; Idato 2018). These consumers of SVOD play a huge part in determining the success of CBS' launch, and many are looking at the variety of shows offered to assist in helping choosing one service over another (Screen Australia 2017).

Key Stakeholders

With CBS introducing their VOD service All Access to Australia, the affected stakeholders can be seen below in Table 1.

Table 1: Key Stakeholders Relating to the Article

Government Bodies / Policymakers

Australian Film Commission

Screen Australia

Video On Demand (VOD) Service Providers

Netflix*

Amazon Prime Video

YouTube Premium

Previously known as YouTube Red until June 2018

Foxtel Now

Stan*

CBS All Access*

Broadcast Networks

Network Ten*

Australian Broadcasting Corporation (ABC)

Foxtel (Fox)

Seven Network

Nine Network

Special Broadcasting Service (SBS)

Eleven

Society

VOD Consumers*

Young Adults

Families

Film Community

*Mentioned specifically in the article and are therefore direct stakeholders.

Research Problem

It is the oversaturation and lack of product diversity in the SVOD Australian market, that presents a significant challenge for the launch of CBS All Access. This over saturation is linked to well established SVOD providers Netflix, Stan, Foxtel Now and others producing their own original content in addition to their growing online libraries, which does not appear to leave much room for a new SVOD product (Williams, 2018). Therefore, the problem being faced is an oversaturated SVOD Australian Market lacking in diverse original content. Should CBS All Access feel to Australian consumers as a ‘Netflix or Stan like' product, this could negatively impact the success of the launch, specifically Australian consumers faced with replacing their current viewing habits with a new SVOD product is unlikely. It is the responsibility of CBS, Screen Australia and the Australian Film Commission to work together to ensure the successful launch of All Access, with the objective to focus on creating more original content. This report will therefore address the research problem from the perspective of CBS Corporation launching in Australia.

Research Questions

R. Q1) How do Australians feel about SVOD services

R. Q2) What do Australians think about CBS launching a new VOD service?

R. Q3) Which group influences the success of VOD services?

R. Q4) What shows make Australians excited for CBS All Access?

Data Collection

Extensive research has been done into SVOD services, their numbers, and the viewing habits of their Australian consumers (Screen Australia 2017; Williams 2018; Ryan 2018; Hazas, Morley and Widdicks 2018). Of the most popular opinion is that SVOD consumers “want to enjoy  new and diverse Australian content” (Screen Australia, 2017). Rather than repeat these findings this report will instead focus on a descriptive study to further understand the viewing habits of Australians through multiple ages, genders, and backgrounds to assist in the successful launch of CBS All Access.

Therefore with particular focus on Australian SVOD this study approaches consumers directly in an attempt to understand the kind of unique content the people would best enjoy.

Methodology

To best understand the consumer behaviour of Australian SVOD users, the chosen method will be that of observational. This will involve the use of both human and electrical administration to better understand the way in which Australian consumers interact with CBS All Access at 8 chosen locations across Australia. These locations will host pop-up style events in busy thoroughfare areas to better allow different socio-economic SVOD consumers to “try before you buy,” even more importantly these events will assist in represent the various demographics which enjoy SVOD services. To assist, the pop-up locations must have staff trained in the use of All Access, as well as to conduct recorded interviews post event, to better yield information which CBS can convert into products. The following characteristics will assist this:

Pop-Up shops offer excitement around a new product including a ‘try before you buy'

Event only has access to CBS content in a controlled environment with search history recorded

Event runs off of a booking system, consumers must reserve their place and agree to filming no more than 6 people at a time.

Entire event must be recorded

The approach of disguising cameras within the pop-up, will allow SVOD users from all walks of life to freely browse what it is All Access has to offer. These recordings will allow for staff to monitor the opinions of the consumers within their natural habitat, as well as allow staff to contextualise information during an interview. It is worth noting that by recording search history, CBS have a formulaic way of categorising content. This will be achieved by having a well enclosed  noise-free space with hidden cameras and microphones, a TV with All Access, with an interview room. The human observation ties into the idea that CBS are more than a name, it allows for people to feel a connection to provide more specific feedback. The mechanical administration further assists by having a precise way of analysing data in search, and video history. An observer, should review interviews and reactions through quantitative methods:

The amount of content VOD consumers wanted to watch (names or shows, or genre)

Gender (female or male)

Size of groups reserved

Age (youth 4-8, preteen 9-12, teen 13-19, young adult 20-29, adult 30-50, senior 60+)

Genre of content normally enjoyed (Sci Fi, Adventure, Action, and others)

Although the event allows for observations to be quite liberal, the observers will have structured open ended questions which are specific and measurable to allow for the information to be categorised.

This study aims to use the findings of these pop-up events to better validate what it is Australian consumers are after. Whether it's Australian content, or just new content. By having locations across 8 varying places in Australia happening at different times, data triangulation is achieved. These pop-up events should be on-going for 6-8 months and should shift locations from major cities, to popular shopping precincts. It should also be noted that Screen Australia have specific statistics based off of 2017 which should be used as a guide to form the pop-up events, for more information about the limitations of this study, including the future of it, please refer to Appendix B.

Research Implications

The feedback provided in this study should assist in key content creation in a practical way for CBS. This will allow any implications for Australian SVOD consumers to be outlined prior to the release of All Access further allowing for a successful launch of a new CBS SVOD product. Analysis data across a broad range of ages, genders, and backgrounds will provide an insight to which products to market to which group. More specifically this may assist CBS and Screen Australia to produce more locally made content. This study would be a door-opener into discovering exactly the kinds of content people are currently enjoying and where the future of SVOD services can do. The findings can be used to assist in annual planning for product release. It is important to note that most Australians have more than one subscription based service to ensure they are able to watch different kinds of content, the price of each service has not been taken into consideration as it is the belief of multiple sources that more content will shape which product SVOD consumers will purchase.

Conclusion

This study aimed to address the issue of an oversaturated SVOD service in Australia, focusing the problem on the need for more diverse content. Specifically the objective highlighted how a pop-up styled event would monitor the consumption of audiences, and more specifically the kind of content they both enjoy as well as want. The hope is the results of this study will not only assist CBS All Access in launching their service, but help to shape the idea of Australians having a say about the kind of content they would like to see, effectively giving CBS the opportunity to create a relationship with the SVOD Australian consumers.

Word count: 1464

Appendices

APPENDIX A - Article: “CBS Confirms Australian streaming platform to launch by end of 2018” by Michael Idato

_______________________________

CBS confirms Australian streaming platform to launch by end of 2018

By Michael Idato.

Speaking to media at a programming showcase in Los Angeles, the streaming platform's president and chief operating officer Marc DeBevoise said it would launch here in the fourth quarter of the year.

That means the local market's two leading streaming platforms Netflix and Stan could have a new competitor as early as October.

Speculation among US media, however, suggests a December launch is more likely.

The announcement today follows remarks made by CBS president Les Moonves on a phone conference call with investors two days ago.

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"Based on our growth trajectory and the trends we see ahead ... we we plan to double our initial goal in just two years," Moonves said.

"That doesn't even include the subscribers we plan to generate internationally," he said. "We have had early success in Canada and we are now getting ready to expand into Australia."

Speculation has surrounded the timing of a local CBS All Access launch since the CBS studio acquired the Ten Network last year.

It is still unclear whether the paid CBS All Access service would complement or replace Ten's free Tenplay catch-up streaming service.

One of the key elements of the CBS All Access launch strategy which is still being finalised is the strength of its content play.

Some of the key titles on the platform are owned by other broadcasters in the Australian market, mostly by output agreements which were signed before CBS's strategy for streaming shifted into the global marketplace.

Local rights to Star Trek: Discovery, for example, are owned in Australia by Netflix, and rights to The Good Fight are owned by SBS.

Another CBS All Access title No Activity is a US remake of an Australian comedy originated by the streaming platform Stan, which retains local rights to the US version of the show.

The second seasons of No Activity and Star Trek: Discovery, due later this year and early next year respectively, will go to Stan and Netflix respecively.

Newer series comissioned by CBS All Access in the US, such as Strange Angel, One Dollar and Tell Me A Story however, could be key titles used to launch the local platform.

Another contender is the remake of The Twilight Zone, which is due in the first quarter of 2019, and a new Star Trek series featuring the return of actor Patrick Stewart as Jean-Luc Picard.

Stan also owns the Australian rights to the CBS-owned Showtime library.

Stan is a joint venture between Fairfax Media, the publisher of this website, and Nine Entertainment.

___________________ End of news story ___________________

APPENDIX B - Limitations and Further Directions of the Study

Words go here…

References

CBS Corporation. 2018. "About CBS Corporation." CBS Corporation. https://www.cbscorporation.com/about-cbs/

Ellis, Katie, Mike Kent and Kathryne Locke. 2018. "Audio description and Australian Television." A Position Paper. http://humanities.curtin.edu.au/wp-content/uploads/sites/4/2018/06/ADPositionPaper_Alt-text-enabled.pdf

Hazas, Mike, Janine Morley and Kelly Widdicks. 2018. "Digitalisation, energy and data demand: The impact of Internet traffic on overall and peak electricity consumption." Energy Research & Social Science 38: 128 - 137. https://doi.org/10.1016/j.erss.2018.01.018

Idato, Michael. 2018. "CBS confirms Australian streaming platform to launch by end of 2018." The Sydney Morning Herald, August 6, 2018. https://www.smh.com.au/entertainment/tv-and-radio/cbs-confirms-australian-streaming-platform-to-launch-by-end-of-2018-20180806-p4zvpf.html

Press, Associated. 2018. "The new Netflix rival coming to Australia." News.com.au. August 9, 2018. https://www.news.com.au/technology/home-entertainment/tv/the-new-netflix-rival-coming-to-australia/news-story/dc1f2d14b3d3ce171572397e9aff43e3

Ryan, Peter. 2017. "US TV giant CBS to buy troubled Ten Network, creating potential streaming rival to Netflix, Stan." ABC News, August 28, 2017. http://www.abc.net.au/news/2017-08-28/cbs-agrees-to-buy-ten-off-administrator/8848124

RibenaUK. 2016. "The Ribena Café - Full Video". YouTube, July 13, 2016. https://www.youtube.com/watch?time_continue=97&v=m6UqXLHHigY

Screen Australia. 2018. "Online & Demand 2017." Screen Australia. https://www.screenaustralia.gov.au/getmedia/f06697b8-07be-4a27-aa8b-bc3ad365238c/online-on-demand-2017

Williams, Cameron. 2018. "The streaming arms race: Original VOD programming in Australia." Metro Magazine: Media & Education Magazine 195: 116 - 119. https://search.informit.com.au/documentSummary;dn=508654240413064;res=IELLCC

Williams, Sue. 2016. "Pop-Up Shops: There's no stopping Australia's latest retail boom" Commercial Real Estate, January 24. 2016. https://www.commercialrealestate.com.au/news/pop-up-shops-theres-no-stopping-australias-latest-retail-boom

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