The New Zealand Herald has an interesting article about state-owned broadcaster Television New Zealand’s on-demand streaming of media moving away from DRM (TVNZ has the same scope of programming and dominant market position as the BBC in England, though alas not the commercial-free public good mandate). TVNZ’s head of emerging business, Jason Paris (who was at the recently-ended Kiwi Foo Camp) said the ad-supported streams outnumbered paid-for downloads by “many thousands to one” and so they’re dropping the DRMed downloads.
Highlights from the Herald’s article:
- “We’ve made a conscious decision at TVNZ that we’re no longer in control of our content,” he said. “We need to make it easier to get it from us than to steal it.”
- TVNZ has been using Microsoft’s PlaysForSure digital rights management software to try to prevent downloaded TV shows from being copied. But just days after the launch of TVNZ OnDemand last March, the protection systems had been bypassed by viewers using software freely available on the internet.
- “The business plan is pretty tight because our delivery costs are so high,” he said.
Advertisers were charged 15c per streamed video to have their ads featured around a programme. An ad agency fee of 4c and the 9c cost of delivering the video to a viewer consumed the bulk of revenue generated.
“That just blows our business model out of the water. We’ve got 2c left to share with content suppliers,” said Paris who is confident TVNZ OnDemand will break even this year on the basis of increased demand for videos and a more cost-effective delivery platform.
- TVNZ OnDemand attracts 150,000 people and streams 200,000 videos a month.