MarketLineIC_Global Broadcasting Cable TV Market Supply Chain Analysis_170922.pdf

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1、Global Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Global Broadcasting&Cable TV MarketSupply Chain AnalysisMLVC001-016Global Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Table of Contents2Complete Supply Chain:OverviewComplete Supply Chain:Overview(contd)Content Cr

2、eators:OverviewContent Creators:AnalysisContent Creators:Burning Issue COVID-19 impactNetworks:OverviewNetworks:AnalysisNetworks:Burning Issue Online piracyNetwork Operators:OverviewNetwork Operators:AnalysisNetwork Operators:Burning Issue Online streaming servicesConsumers:OverviewConsumers:Analysi

3、sConsumers:Burning Issue Increasing costsAppendixGlobal Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Complete Supply Chain:Overview3The global broadcasting&cable TV markets supply chain can be divided into four distinct stages:content creators,networks,network operators,and consumer

4、s.Content CreatorsStudiosLive Event ProducersEquipment ProvidersWritersNetworksAdvertisersBroadcast&Cable ProgrammersDistributorsNetwork OperatorsCable,Satellite,and TelcosBroadcastersConsumersViewersConsumer Electronics ManufacturersGlobal Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-

5、016Complete Supply Chain:Overview(contd)4The global broadcasting&cable TV markets supply chain can be divided into four distinct stages:content creators,networks,network operators,and consumers.Large companies are vertically integrated throughout the supply chain.Content CreatorsEnglish Premier Leag

6、ueNFLIndividual WritersDirectorsNetworksComcastAT&TWarnerMediaThe Walt Disney CompanyNetwork OperatorsBBCAT&TComcastChina Central TelevisionConsumersIndividual ViewersSamsungSonyLG ElectronicsGlobal Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Content Creators:Overview5Content creat

7、ors vary between individual creators or collective organizations.Content CreatorsIndividualsWritersCollective OrganizationsLive EventsNews OrganizationsEquipment ProducersGlobal Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Content Creators:Analysis6Content creators can vary in influ

8、ence and size.Content creation for broadcasting&cable TV can vary-it can be individuals,such as writers,live events,news organizations,or others.Individual creators may have had success before in television or a crossover,such as from literary publishing.The most prominent example would be HBOs Game

9、 of Thrones series,from George R.R.Martin.There may also be collectives,such as animation studios.Other examples include live events,such as sports.The governing bodies for some of the most renowned sports can be state backed or large and influential,such as the English Premier League for soccer or

10、the National Football League(NFL).There is a high degree of vertical integration throughout broadcasting,and so news organizations can also form parts of media conglomerates.CNN in the US is owned by Time Warner,and Comcast owns NBC,the parent company of MSNBC.In some cases,governments may create a

11、new organization with a public service mandate,such as the BBC in the UK,Chine Central Television in China,or other state-owned networks such as RT and CCTV.News networks can increasingly be serviced by individual consumers given the advent of smartphones and social media,providing eye witness accou

12、nts of events as well as video recordings.Global Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Content Creators:Burning Issue7Content creation was curbed in 2020 by the global outbreak of COVID-19The widespread outbreak of coronavirus is having an impact on markets and industries acr

13、oss the globe.The creation of television content is no exception.With advice ranging from country to country but generally recommending isolation and social distancing,the creation of content has been limited.Television content from soap operas to sporting events have been affected.In March 2020,the

14、 English football Premier League was postponed for 100 days,the UEFA Euro 2020 was cancelled along with the Summer Olympics.Sporting events across the globe were put on hold.In the UK,major musical festival Glastonbury was cancelled for 2020 and 2021,which drew television audiences of around three m

15、illion in 2019.The Eurovision Song Contest 2020 was also cancelled.The contest attracted 182 million viewers in 2019.Whats more,soap operas and television shows in many countries stopped recording or were significantly restricted.In the UK,popular soap operas including Coronation Street and Eastende

16、rs were aired on reduced schedules throughout part of 2020.While content creation has since resumed,it has not been without its challenges.Filming for many productions had to be carried out in a socially distanced manner and crew numbers were reduced.Global Broadcasting&Cable TV Market:Supply Chain

17、Analysis-MLVC001-016Networks:Overview8Networks demonstrate a high degree of vertical integrationDominated by the big four,Interpublic Group,Omnicom Group,Publicis Group,and WPP.NetworksProgrammersDistributorsAdvertisersResponsible for filling the entire broadcasting day with suitable programming.Glo

18、bal Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Networks:Analysis9Networks are usually large diversified media conglomerates integrated throughout the supply chain.Networks consist of distributors,which are usually large firms with international reach.Studios such as Paramount Pict

19、uresand Universal are owned by Viacom and Comcast respectively.21st Century Fox was recently acquired by the Walt Disney Company.Given the large costs of production and uncertainty in returns on investment,these companies have to be large in scale in order to minimize risk and pool resources.Adverti

20、sers are also integral to the viability of commercial broadcasters.While ad revenue is decreasing and other methods such as subscription are gaining popularity,the industry is highly consolidated with Interpublic Group,Omnicom Group,Publicis Group,and WPP accounting for a large share of total indust

21、ry revenues.This is exacerbated by the fact that these companies have been acquisitive in recent years and so many companies that do not bear the name of the big four are indeed subsidiaries.Advertising agencies are dependent on creative talent.This is a highly-skilled,highly-specialized role and to

22、p practitioners are often the subject of headhunting.The big four have the financial might and the offer of work for world-renowned clients to give them a competitive advantage in this regard.Despite the dominance of the big four,independent players are able to enjoy success and carve a niche,someti

23、mes becoming multi-million dollar businesses themselves.A good example is Wieden+Kennedy,best known for its work with Nike.It has also attracted major clients in the shape of Coca-Cola,KFC,and Ubisoft.Programmers tend be individuals within the networks,organising scheduling.Global Broadcasting&Cable

24、 TV Market:Supply Chain Analysis-MLVC001-016Networks:Burning Issue10Piracy has become increasingly easy and is staying ahead of legal developmentsContent theft is made easier by the wide availability of higher bandwidth and reduced storage costs,as well as tools that undermine encryption while boost

25、ing the users,such as VPNs.For example,new mobile broadcasting tools enable users to livestream content,including copyrighted content,which can lead to content theft and could have an adverse impact on the monetization of content.Unauthorized access to content could result in the premature release o

26、f motion pictures or television shows as well as a reduction in legitimate audiences,which would likely have significant adverse effects on the value of the affected programming.It is also subject to a cumbersome legal framework which takes time to catch up and can never outpace the technological ad

27、vancements.Proxies navigate website blocks,and despite numerous legal challenges,the most notorious piracy website The Pirate Bay remains active.There is also the threat of streaming,with Kodi boxes and also with the popularity of live streaming services such as Twitch,which present new challenges f

28、or both distributors and policymakers.Global Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Network Operators:Overview11Network operators demonstrate a high degree of vertical integration.There is also the opportunity for governments to be involved in a public service model.Both model

29、s below will require an installation fee as well as monthly subscription.More likely to make revenues purely from advertising,no subscription fee.Network Operators Telecoms CompaniesSatelliteCableGovernmentsPublic Service Broadcasting“Freeview”Global Broadcasting&Cable TV Market:Supply Chain Analysi

30、s-MLVC001-016Network Operators:Analysis12Network Operators tend to be large media conglomerates or public-sector enterprises backed by governments.Network operators tend to be large media conglomerates integrated throughout the supply chain.Larger examples include Comcast,and Viacom,but another exam

31、ple would be ITV plc,which holds regional licenses throughout the UK but is not only broadcasting but producing content and distributing it.There has been a wave of consolidation at this stage,with Walt Disney purchasing 21st Century Fox,and AT&T buying Time Warner.This contrasts to a wave of demerg

32、ers in the industry a few years ago.Regulation varies in this market greatly.In some countries like the UK,advertising opportunities such as product placement are strictly regulated,whereas scrutiny is more relaxed in the US and Australia.This can also extend to mediums such as news organizations re

33、garding political broadcasts.Governments can also introduce public sector institutions into this stage of the chain.There are a variety of different funding models for this,but the aim is to provide a public service for the respective country.For instance,the BBC is funded by a license fee and free

34、of advertising,while in Canada the Canadian Broadcasting Corporation(CBC)employs commercial advertising to supplement its federal funding on its television broadcasts.Some are just centrally funded,such as RIA Novosti in Russia,or China Central Television,the predominant state television broadcaster

35、 in China.CCTV has a network of 50 channels broadcasting different programmes and is accessible to more than one billion viewers.It is funded centrally by the State Administration of Press,Publication,Radio,Film and Television.Global Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Netw

36、ork Operators:Burning Issue13Digitalization has seen streaming services prosper at the expense of terrestrial broadcasts.Internet video on demand applications such as Netflix,Amazon Prime and Hulu have grown in popularity in the last few years,offering a low-cost alternative with a vast array of con

37、tent.The 2020 COVID-19 pandemic and subsequent lockdown and movie theater closures seen in many countries has help to aid this growth.Netflix is currently the leading video streaming platform.During 2020,Netflix added more than 36 million global subscribers,taking its total to over 200 million subsc

38、ribers worldwide.Netflix has produced a wealth of original content that has been met with success,for example,Netflix original series Stranger Things is one of the highest ranked shows on Internet Movie Database(IMDb).Netflixs US subscriber base still pales in comparison to the broader pay-TV market

39、,which includes satellite operators like DirecTV and Dish Network,TV services from phone companies like Verizon Fios,and internet-TV services such as SlingTVand DirecTV Now.Elsewhere,there has been some adapting in order to cater to the online market,with broadcasters offering on demand services to

40、access back catalogues.Streaming services such as Hulu,Disney+,Netflix,and Amazon continue to grow rapidly and much faster than traditional mediums.Disney and Comcast have created their own online service with Hulu and the large studios maintain the copyrights being used.Walt Disney also released it

41、s Disney+streaming service in the US in November 2019 and elsewhere throughout 2020,while AT&Ts WarnerMedia also launched its own streaming service,HBO Max,in May 2020.Global Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Consumers:Overview14End-users in this market are generally hous

42、eholds or individuals.ConsumersIndividual ViewersGlobal Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Consumers:Analysis15Consumers are end-users with little influence in the market.Companies within the broadcasting and cable TV market gain their revenues through a range of different

43、 channels.Public broadcasting companies typically gain their revenues through state enforced licensing fees,government funding and advertising,and can therefore cater for less lucrative target audiences.Private broadcasting companies gain revenues through the sale of advertising time and subscriptio

44、n fees.Many individual consumers have very little buyer power,as TV license fee prices are fixed by the state and are a legal requirement for owning a TV in several countries.Individuals can only make an impact as a whole by displaying preferences of a product through viewing figures.They can,howeve

45、r,choose whether or not to subscribe to pay TV services such as Sky or internet video on demand applications such as Netflix and Hulu.However,as these services often hold exclusive broadcasting rights for sport such as Sky in the UK or ESPN in large parts of the Americas,as well as leading dramas,th

46、ey are viewed as a necessity by some consumers.Alternatives for consumers include streaming services or piracy to access content.This can become a problem in countries where intellectual property law is enforced weakly.Consumers risk fines,and although governments may attempt to intervene by blockin

47、g renowned sites,more tech-savvy individuals can easily bypass it.Global Broadcasting&Cable TV Market:Supply Chain Analysis-MLVC001-016Consumers:Burning Issue16Consumers are facing increasing costs in various countries due to interpretation of competition laws.As more media companies vertically inte

48、grate and engage with content production,consumers are facing higher costs as the market fragments and subscription channels become increasingly prevalent.The decline of mass media advertising revenues has forced companies to rethink models,and this can manifest in various different subscription opt

49、ions.Various entities,such as the NBA in the US and WWE now offer their own video on-demand services.Walt Disney released its Disney+streaming service in the US,Canada and the Netherlands in November 2019,and in other parts of the world in 2020.Meanwhile,AT&Ts WarnerMedia also launched its own strea

50、ming service.In the UK,attempts to open up the market to competition have led to competition between BSkyB and BT for sporting views,requiring either two separate subscriptions or a more expensive all-inclusive one.Cheap alternatives such as Hulu and Netflix have grown in popularity due to accessibi