The implementation of the next-generation ATSC 3.0 broadcast standard is expected to bring significant advantages to medium- and large-market television stations in the US, including more ad revenue, television viewership and management of digital competition.
A BIA/Kelsey report examining the conversion to the ATSC 3.0 standard from a business perspective concluded that larger stations that are considering implementing the ATSC 3.0 standard would be recouped within three years.
“ATSC 3.0 will change the business of broadcasting into a next generation wireless communications business,” said Mark Fratrik, chief economist and SVP, BIA/Kelsey. “This new technology will give broadcasters the ability to pursue multiple new business models which will significantly diversify their current revenue mix.”
At the core of broadcasters’ ATSC 3.0 expectations is the ability to offer a new IP platform to better satisfy the changing needs of consumers and advertisers. One of the top business objectives is maintaining or increasing viewership by offering superior service to their viewing audience, including the delivery of a higher quality experience, more programming options and ongoing innovation to accommodate expected (and unexpected) abrupt and hard-to-predict changing viewing patterns.
Broadcasters also want to raise advertising revenue through increased viewership, better ad targeting, dramatically expanded and more accurate viewership tracking, and a capability to better integrate multiplatform campaigns; and they’re interested in growing non-advertising revenue through the development of new IP-based broadcasting and non-broadcasting business models.
“As the business of television broadcasting morphs into a broader content distribution service, many new service offerings will evolve,” the report noted.
The report also covers concerns related to the ATSC 3.0 conversion, which include overall capital cost, providing uninterrupted service to their existing audience and determining the relevant time frame for transition.
“The biggest opportunities around the implementation of ATSC 3.0 are that it will give broadcasters a new opportunity to grow and address their major concerns like reversing recent local television station viewing trends,” explained analyst Mark Fratrik. “In our report, we present the business model for implementing ATSC 3.0 based upon our assumptions of the speed of introduction and acceptance by consumers, advertisers and other players in the media ecosystem and overall it’s quite positive for the vast majority of local television stations.”
The FCC recently said it was fast-tracking ATSC 3.0 rollouts.