20 years – is this a lot or a little time for the largest event in the TV and telecom industry? This was the topic discussed by guests at the official opening ceremony of the CSTB. Telecom & Media exhibition and forum which took place on the 30th of January at the International Exhibition Centre Crocus Expo. Director General of Midexpo Irina Nedumova, president of the Russian CATV Association Yuriy Pripachkin, Director General of Tricolor TV Aleksey Kholodov, vice-president of Huawei Russia Zheng Xin, general producer of Channel 1. Global network Dmitry Borisov and Deputy Director General of VGTRK (All-Russian State Television and Radio Broadcasting Company) Dmitry Mednikov took part in the ceremony. Additionally, German Klimenko, an Internet development advisor to the President of the Russian Federation forwarded a letter of congratulation to the event who noted the significant role of the exhibition and forum in developing connections between producers and consumers as well as quality improvement of operator and TV services. The project was called “Big Digital History”; “a tradition without which the sector cannot imagine the beginning of the year”, an event which provides experts with an opportunity to determine the direction of the industry development.
From the official ceremony the participants and the guests of the event proceeded to the business part; on the 1st day of the anniversary CSTB. Telecom & Media work there were important business events aimed at determination of the development direction of the TV and telecommunications industry for the following year. The business program started with a round table which this time was devoted to a burning issue – Business development strategies of terrestrial and non-terrestrial channels in various propagation mediums. Here the industry leaders discussed fundamental changes happening in the content distribution sphere and exchanged their opinions on how user flow is changing while watching linear and non-linear TV. The event presenters were leaders of teenage and music VIACOM broadcasting channels Yana Churikova and president of the Russian CATV Association Yuriy Pripachkin. Alexey Volin, the Deputy Minister, the Ministry for Communications and Media, Mikhail Silin, the Vice-President of the Russian CATV Association, Dmitry Mednikov, the Deputy Director General of VGTRK, Valentina Udalova, the director of programs distribution networks, Channel 1, Kirill Lysko, the Director General, Digital TV, Mikhail Kovalchuk, the Director General, Signal Media, Zheng Xin, the Vice-President, Huawei Russia, Aleksey Kholodov, the Director General, Tricolor TV, Natalya Bratchikova, the director of the Fix Business Marketing and TV Department, MTS, Romanchuk Viktor, the director of the Video items office of the mass segment branch, Rostelecom, Maria Sitkovskaya, the director for media business promotion, VimpelCom, Mikhail Demin, the Director General, NTV-PLUS, Kirill Makhnovky, the Director General, Orion Express, Nikolay Orlov, regional vice-president, Eutelsat S.A., Zharkyn Tursynov, the managing partner, director of the LifeStream company promotion, Ksenia Achkasova, the director of TV research, MediaScope and Alexandr Liger, the Deputy Director General, NSK, took part in the discussion.
One of the topics for discussion was the problem of pirated content and methods to fight against it. As Aleksey Volin noted, “the main pirated resources for distributing video content have been blocked due to copyright holders’ claims. Besides, the Ministry started blocking mirror sites of unauthorized websites, more than 500 mirror sites have already been blocked (its cumulative audience amounts to 200 million people)”. The speakers agreed that, for the average user, content is primary and not the method of consumption and the market members should work together on creating content of value as seen in the consumer’s eyes. Besides, the experts noted that non-linear watching is gaining momentum, while a subscriber at any convenient time is often viewing items designed for linear watching. For example, channels will not stop broadcasting long series and movies but watching them on tablets and mobile phones is not convenient.
A lot has been said about the OTT services including the fact that the OTT development depends on how TV channels are going to establish their platforms for legal content distribution. OTT-consumption is steadily growing due to young audience consuming content with mobile apps and using delayed viewing. In these circumstances traditional terrestrial broadcasting should not be excluded, it is better to consider segmentation of delivery.
The participants discussed telecom-operators and content-makers relationships which in many ways still exist in the grey area: telecom-operators work in non-competitive environment which lacks the industrial statistics – there is no data concerning TV watching and subscribers’ payment distribution. The players do not have clear and transparent game rules: very often channels which are viewed more are less valuable in monetary terms.
The same topic – existence of channels in the Internet environment – but from a perspective of legal distribution and monetization, was a keynote of a separate presentation, where NSK, Channel 1, SPB TV, MTS and Vitrina TV companies together with Aleksey Volin, the Deputy Minister, the Ministry for Communications and Media discussed what drivers and barriers exist for TV channels broadcasting on the Internet. Currently there is no single platform solution, however, technologies have made a great steps forward that allows the key market players to legalize their presence in OTT to the greatest possible extend. Aleksey Byrdin, the Director General of the Internet-video Association was the moderator. The sector representatives gave various opinions on which solutions are necessary for the field so that TV channels and services providing broadcasting in OTT could interact effectively. For example, to create a big enclosure platform for content delivery services (Yandex or online movie theatres) that would be commercially interesting. In opposition to this – another point of view – TV channels do not need to convince anybody because there content it the best one in the market. The purpose of a TV channel is to enter the advertising market on the Internet and “eat off” a part of it.
The experts agreed that broadcasting in OTT is connected with technological difficulties, TV channels should cooperate with the platforms which provide modern solutions, for example, broadcasting target advertisement to a certain viewer depending on the facility.
An example of a successful integration is broadcasting in the Channel 1 OTT networks. The TV channel chose a cooperation strategy with leading platforms and agreed on conditions, also till February 10 Channel 1 is accepting offers from smaller resources and applications concerning an intent to broadcast their program items.
For the first time at CSTB. Telecom&Media 2018 a Strategic Session for Russian Producers’ Associations took place, within which the participants S.V. Khokhlov, the Radio and Electronic Industry Department of the Ministry of Industry and Trade of Russia, A.V. Maslennikov, the Economic Sectors Development Department of the Ministry of Economic Development of Russia, S.N. Efimov, the Regional production and technical directorate of VGTRK, K.Yu. Kukk and V.N. Ivanchuk, Association of developers and producers of TV and Radiobroadcasting Facilities (ARPAT), A.V. Kolesnikov, Association of Members of the Internet of things market (AIV), E.A. Filatova, Association of Augmented and Virtual Reality (AVRA), A.A. Bezrukov, GS Group, Committee for regulating the internal market of the Association of developers and producers of electronics (ARPE), N.A. Utkin, RBC and M.A. Savelieva, TPV CIS LLC thoroughly discussed impetuses for domestic production development. According to the audience, the most important of them are fiscal expansion, state purchases, customs and tariff regulation, state subsidization and standardization. During the discussion the participants came to the conclusion that all the standards should be harmonized with the international practice, otherwise the domestic production will not be able to compete with the foreign one. In such a manner the incorporation of the Russian producers into the international economy is seen by the experts as a natural and necessary step for a further incremental development of the field. Scientific and technical cooperation with worldwide companies is acknowledged as one of the resources of foreign investments which can cover overheads arising out of technology complexity and high cost of developments in general. The essential condition for cooperation is called a gradual strengthening of the production localization. Ultimately it will lead to import independence. The experts also noted that in spite of evident disadvantages in the production stimulation system the number of domestic brands is constantly growing thus increasing the market share. The session moderator was the president of Association of trade companies and goods producer of electronic household appliances and computer hardware (RATEK) A.V. Onishchuk.
As an example of domestic production, GS Group at the CSTB. Telecom & Media 2018 Exhibition presented its first TV-tuner on the Android platform that was developed and produced in Russia. The new device of the General Satellite brand allows going beyond the linear TV turning a TV set into a multimedia center with a great variety of services. The production of the TV-tuner is starting in 2018. The whole technological chain – from producing to packing the final item – will be launched at the Technopolis GS of innovation cluster enterprises. In the years ahead GS Group will launch a line of similar appliances for the Russian telecom operators in the market.
Another discussion concerning ULTRA HD – a new global stage in TV development? had gathered Konstantin Ankilov, the Director General of TMT Consulting, Mikhail Goryachev, the content director of Tricolor TV, Aleksey Ugrinovich, the Director General of Dolby in Russia and the CIS, Alexandr Surkov, the manager of the analytical center of the GS Group Holding, Michel Chabrol, the senior vice-president of new TV formats of Eutelsat S.A, Zharkyn Tursynov, the development director of Lifestream (Smotreshka) and Jim Phillipov, the products marketing director, Irdeto. The discussion was moderated by Nikolay Orlov, the Director General, 1 TVCH, and Alexandr Chernyaev, the leading manager, Huawei.
The experts discussed changes in Russian and international UHD markets in 2017, prospects for development of a subscriber base for UHD Television in Russia, the growth drivers and problems of technology development. According to analysts, each third TV set sold in the world has the Ultra HD format option. Of course, in Russia this figure is still a bit lower – around 16% appliances sold but this percent is growing because the cost of items is decreasing. Currently there are no other technical or commercial problems for 4K development in Russia. On the contrary, the infrastructure, the content and the producers of household appliances – everything promotes development of the industry. The only question is the matter of content. Western major producers have already started creating it in great numbers (for example, in Western Europe they predict 42 channels in 2019) but there is almost no domestic content in the market. Besides, now the Tricolor TV operator broadcasts 6 channels in UHD, the share of the Russian content is very low. But there is a prospect – the 1 TVCH Company is starting to film its own content in Ultra HD. The MTS operator has announced launching of a 4K service for the 2018 FIFA World Cup.
Ultra HD is an ecosystem in which large international companies invest serious money at each technological stage. That is why Ultra HD today is a growth driver in the market for the whole telecommunication field. Security systems of UHD content have also been discussed. Technical peculiarities of the conditional access systems and TV-tuners for UHD content allows it to be the most protected one as of today.
The forum of regional operators has gathered representatives of the sector from all over Russia and has become one of the most visited business events of the day. The participants are Mikhail Medrish, Comcor OJSC, Iskandar Bakhiyarov, Ufanet, Dmitry Galushko, Ordercom, Vitaly Korneev, Vidicon, Alexand Vasiliev, Lanta, Vsevolod Simenido, KETIS, Yuriy Gulak, Oreol, Iliya Fominykh, Sevencom, Stanislav Kolgatin, Kontur-M, Vyacheslav Berson, 1 TVCH.
The moderator Oleg Grishchenko, president of the Rosteleset Association put an emphasis of the audience on the Yarovaya law and possible ways of its implementation on the context of data storage by the operators. The forum participants agreed that the law passed in 2016 does not meet the operators’ expectations and interferes with their activity. The experts had different evaluations concerning the latest governmental regulation, the dispute was focused on the necessary term of data storage – in the latest governmental regulation it was reduced to 1 month. The majority of the experts have noted some progress in the dialogue between business and authorities; the speakers noted that the authorities had started to heed minor operators’ opinion.
Besides, the issues of optimizing the content filling of channels, the necessity to determine the unified parameters for assessing channel viewing and mobile Apps development for satellite-based operators as well as mobile TV promotion for the tablets generation were touched upon.
While discussing the issue of organizing a package (what should be in the analogue TV, what should be in the open digital TV, what the premium package should be like) the speakers came to conclusion that the majority of regional operators are extending their digital package and decreasing the expensive analogue TV. In the course of discussion, the representatives of 2 principal approaches had a dispute concerning determination of the best strategy for operators on subscribers retention and asked themselves what the real client-oriented approach means: cutoff of niche channels and preservation of monthly subscription or support of the niche contents which inevitably leads to the increase in cost.
During the first day of the CSTB. Telecom & Media’2018 exhibition and forum work more than 1,500 people attended the business program which became a significant attendance achievement for the Forum.