APRIL 10 – TV companies will have to drastically adapt to the rapidly changing world of online entertainment if they hope to survive, experts have warned.
Broadcasters are already catching up with online gaming giants in the battle for the attention of the young audience and the advertising crowns that come with it.
On the horizon is the so-called “metavers” – a loose term that covers the growing ecosystem of interactive online worlds, games and 3D hangouts that already attract millions of users.
While older consumers are still hooked on traditional television, viewership for those under 35, according to Statista, has halved in a decade and will decline sharply as the meta-verse expands.
“Young people have gone from passive TV viewers to active gamers, and they have moved away from screens to smartphones,” said Frédéric Cavazza, co-founder of Sysk, a French company specializing in digital transformation.
“TV channels will die along with their audiences.”
“Part of the story”
To reach young people, broadcasters will have to compete with gaming platforms such as Roblox, Fortnite and Minecraft – which are seen as forerunners of the meta-verse – which are already establishing a dominant position.
According to media research firm Dubit, half of 9- to 12-year-olds in the United States use Roblox at least once a week. They do everything from games to concerts to hanging out with friends.
The audience can be huge: 33 million people watched rapper Lil Nas X perform on Roblox in 2020, more than three times as many as saw him on TV at the Grammy Gauls this week.
Broadcasters need to choose whether to stick with a declining market for traditional TV programming or start integrating their characters and brands into metaverse platforms, said Matthew Warneford, co-founder of Dubit.
“It means bringing people into a world, making them a part of the story, playing with their friends – just like Disneyland lets you and your friends be in their world with Mickey Mouse,” he said.
Television companies have time to adapt, but they face a major challenge in terms of both older people watching traditional shows, middle-aged people switching to streaming, and young people wanting interactive and social entertainment.
“If we want to remain relevant, we will have to position ourselves on all these applications,” said Kati Bremme, Head of Innovation at France Télévisions.
The national television station is still in research mode, she said, playing with augmented and virtual reality to build immersive cultural and sporting experiences.
However, the biggest challenge may be financial.
So far, broadcasters have been immune to technological disruption, as their advertising revenue has been largely unaffected, unlike other traditional media such as newspapers.
That could change “faster than people think,” Warneford said.
It used to be hard to bring TV commercials into the gaming world because they were created by individual companies that “locked them in and captured all the value,” he said.
But with the metaverse’s more open field, brands will have much more leeway to promote themselves and sell goods directly to users.
In fact, fashion and luxury brands are already making millions by selling virtual clothes and accessories on Roblox, Fortnite and other platforms.
“If they want to reach young people, do companies continue to go to TV, or do they go where the young people really are – in games and the meta-verse?” – ETX Studio