Home Analysis Belgian and Swiss Pay TV operators accept the end of ad-free time-shifting...

Belgian and Swiss Pay TV operators accept the end of ad-free time-shifting on STBs

Major Pay TV operators across both Belgium and Switzerland are cooperating with broadcasters to allow advertising in Replay TV and even PVR recordings when viewed on their set-top boxes. In both countries, a new model has been agreed that involves pre-roll ads or unskippable breaks. This is a significant moment, as the sustainability of commercial broadcasters and their popular local content becomes a bigger priority than pure consumer choice (whether to watch ads). The growing volume of time-shifted TV viewing, combined with greater competition for broadcaster money, explains the development.

Wilfried Celis, Director AV Strategy & Partnerships at DPG Media, speaking at FTV Global 22
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Broadcasters and Pay TV platforms in Belgium and Switzerland are demonstrating the extent to which they are willing to collaborate to ensure the continued health of the ad-supported television ecosystem – therefore sustaining investment in local programming.

In Switzerland, time-shifted television has received a complete make-over to ensure there is at least some advertising within Replay TV on set-top boxes owned by over 30 national and regional distributors including Swisscom, Sunrise, Quickline and Zattoo. Three ad formats have been introduced for the time-shifted viewing: short pre-roll, pause advertising (showing static displays – and these can also be applied to live television) and fast-forward advertising (which is shown when someone tries to skip the ad break of a linear show that is being watched in delay/time-shift mode).

Over 20 channels in Switzerland are covered by the new agreements, including Nitro, RTL Zwei, Nick Schweiz, Sixx, Gold, TV24, S1 and RTL. Explaining these developments at The Future of TV Advertising Global last week, René Wodrich, Head of Sales at Goldbach Media (Switzerland) and Christian Arm, Advisor Digital Innovation at the broadcaster, said Replay Ads, “expand and secure TV as a mass medium for the future”. This innovative concept was launched in October and is now available to 95% of households in the relevant German-speaking parts of Switzerland.

The London conference also heard how Belgium has adopted a similar model to ensure broadcasters can properly monetise their content when viewed on-demand. Wilfried Celis, Director AV Strategy & Partnerships at DPG Media (the broadcaster operating across Denmark and the Netherlands, as well as Belgium, whose channel brands include VTM, VTM Kids, VTM Nieuws and Streamz) noted that there is a focus on achieving a balance between the viewing experience and a new advertising model.

In practice this includes a 60-second unskippable ad break at the start of every PVR recording on operator set-top boxes – something that has already been implemented by Telenet, and which will be adopted at the other leading Pay TV operators Proximus and Orange soon. 100% of ad breaks during Replay TV are unskippable, and this feature is already fully implemented at the same three platform providers.

Belgium has a high level of time-shifted viewing, making this kind of initiative increasingly important. Celis showed the figures for 2022 viewing behaviour in the country, where 45% of viewing today is live/linear and 26% is time-shifted (with 29% of viewing covered by streaming). He quoted forecasts that by 2025, 70% of video content in Belgium will be watched on-demand, with less than half of all video advertising campaigns going to linear TV. BVOD will also account for 20% of linear TV revenues in that year, he added.

Like in Switzerland, these innovations are part of a major recalibration of the advertising model, the user experience and the relationship between broadcasters and operators. The new Belgian blueprint also agreed that there will be prominent visibility for broadcaster content on all platforms and user interfaces, and that seven-days’ worth of Replay TV will be available to all subscribers on the Pay TV platforms involved (making it a default rather than a premium offering).

The Belgian TV industry has taken one step further, jointly backing broadcaster efforts to digitise TV while optimising the reach of television for advertisers. Operators have agreed to gain customer consent for consumer data to be used by broadcasters. There will also be greater collaboration around set-top box return path data. Other channel owners involved in the Belgian industry initiative are SBS, VRT, RTF.be and RTL Belgium.

In the case of DPG Media, there are agreements that almost all types of operator STB will be connected to DPG Media’s ad server, meaning ad-decisioning is performed at the broadcaster (who has control over frequency capping and pacing of campaigns, for example). This model enables more unified planning; the DPG Media ad server provides for forecasting, launch, optimisation and reporting across linear TV as well as the ‘Broadcaster VOD Network’ (covering, at DPG Media, STB on-demand, the VTM Go streaming service on connected TVs and multiscreen).

Returning to the reasons for these non-skipping ad agreements for time-shifted TV, Wodrich at Goldbach Media, declared: “Time-shifted viewing had become a major challenge for us as a television sales house, with people able to skip the ad break. We are privately owned, so have to earn money through advertising, selling context and ‘contacts’, and if we have less inventory and less contacts to sell, that is a problem.”

Editor’s Comment

For a long time, the concept that ‘consumer is king’ has ruled the Pay TV CX, and there was a reasonable argument that by paying their Pay TV operator subscription, viewers were buying the right to skip ads in PVR and Replay TV viewing on set-top boxes. These new agreements could indicate that we have reached the high-tide mark for ad skipping. In the D2C/streaming app domain, broadcasters already control the experience when watching their content (on their ‘player’ services), so can enforce ad watching on catch-up television and box-set VOD. The agreements in Belgium and Switzerland are a compromise between ‘the viewer rules the set-top box’ and ‘the broadcaster rules streaming’.

These deals for ad-lite, time-shifted viewing on operator STBs should be viewed in the wider context of operator agreements to carry D2C streaming apps like Netflix and Disney+. Pay TV operators need the best content, from everywhere. And in their quest to be the ‘super aggregator’ that unifies the entire world of premium viewing through a single user interface, operators have two very compelling advantages [versus global hardware manufacturers and OS providers]: their multichannel linear EPG that includes all the local broadcasting, and the instant availability of that broadcaster world in time-shift mode. These deals reinvigorate the all-important operator/broadcaster win-win relationship (with commercial channels).

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