TotW [Team 36]: Disruption vs. Digitalization: Apple TV vs. Ziggo TV


Since the night of October 2nd, 1951, when the first Dutch TV-show was broadcasted to 500 TV sets in the Netherlands, the way we consume TV has changed. Especially since the initial introduction of Apple TV in 2007 and UPC Horizon (now Ziggo) in 2010, the landscape in digital TV has changed significantly. The Apple TV has since developed to a device that turns your regular TV screen into a smart TV with a single purchase, while the Ziggo Horizon mediabox is a so-called ‘multimedia gateway’; delivering both traditional and digital media on a subscription basis.

Although the goal of these two products seems similar, when comparing these two new ways of delivering content to the consumer, there are differences that should be noted. The offering of Apple is based on hardware, in combination with the promise of an ecosystem. Ziggo offers a subscription, which includes a hardware component. An advantage of Apple TV is that it allows for integration with other Apple devices, delivering an omnichannel experience. For Ziggo the main competitive advantage is the integration of traditional TV in its offering, as it gives them the opportunity to gain market share through their current clients and business model.

SWOT

Fig. 2: The strengths, weaknesses, opportunities and threats of Apple TV and Ziggo TV

As it comes to the future of these two ‘information goods’, we foresee the impact of three high-level trends. The evidence shows (fig. 1) that young people view less traditional TV, demonstrated by a 17% decrease over the past year among youngsters aged 18-24. Although indirectly and limitedly available, almost all TV channels have developed their own (web)apps, providing traditional content online. Simultaneously, the providers of TV-signal (like KPN, Ziggo and Telfort) are moving towards new business models that allow for more customization.

TDG-Consumption-Live-TV-v-OTT-by-Age-Mar2014

Fig. 1: Consumption of Live Broadcast vs. Online TV services in the United States (MarketingCharts, 2015)

Our prediction for the future is that devices such as the Apple TV will become dominant over a product/service such as Ziggo’s Horizon media box. Anticipating the following main characteristics as of why people adapt to a new way of receiving their content; increased importance of ease of use and installation, customers want freedom of choice; they want to watch what they want, when they want, and the availability of content.

To conclude on our comparison and future prediction; the question to Ziggo should be to both compete with Apple and create their own ecosystem by collaborating with third parties, or to become a subscription based app that offers live television on devices such as an Apple TV, and compete with apps such as KPN’s ‘Play’. Because of Apple TV’s ease of use and installation, the freedom of choice it offers and the possibilities created by its ecosystem, we predict that Apple TV becomes the dominant way of watching TV. Where Ziggo digitalized watching TV, Apple will disrupt the way of watching TV. To wrap up, we agree with Apple: “the future of television is apps”  (Apple, 2015).

Do you agree with Apple’s vision? And do you think other trends will impact the way we consume video content in the future?


References
Apple (2015) The future of television. Accessed on 27 September, 2015, retrieved from Apple: http://www.apple.com/tv/

De Beeld en Geluid Wiki (2013) De eerste landelijke televisie uitzending. Accessed on 26 September, 2015, retrieved from Nederlands Instituut voor Beeld en Geluid: http://www.beeldengeluidwiki.nl/index.php/De_eerste_landelijke_televisie_uitzending

MarketingCharts (2015) Youth Say OTT Video Challenges Live TV in Weekly Consumption. Accessed on 27 September, 2015, retrieved from MarketingCharts: http://www.marketingcharts.com/online/youth-say-ott-video-challenges-live-tv-in-weekly-consumption-41545/

Reijerman, D. (2015, June 24) KPN gaat 22 zenders en Chromecast-ondersteuning aanbieden in testversie Play-app. Accessed on 26 September, 2015, retrieved from Tweakers: http://tweakers.net/nieuws/103886/kpn-gaat-22-zenders-en-chromecast-ondersteuning-aanbieden-in-testversie-play-app.html


Team 36
Thomas Langenberg (346257)
Ken French (360107)
Floris Wesselink (345299)
Bas Louwman (349033)
Juliën Mets (357789)

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