Media: All about ... Video-on-demand services

What will become of Project Canvas and its rivals, Alasdair Reid asks.

Quite how BBC managers came up with their marketing budget projections for the first four years of Project Canvas is anyone's guess. But, actually, come to think of it, BBC managers, especially on the new technology side, are rather good at creative guessing games, not least when it comes to budget and spend figures.

The figure they plucked out of the air last week was 拢48.4 million - though (rather disappointingly, given the oracular powers of the BBC's future media group, headed by Erik Huggers) there's no indication about whether that money will be blitzed on a launch campaign or will be spread evenly.

拢12 million a year, though, is not to be sneezed at. This would put it in the same league as the combined The Sun and News of the World account, for instance. Or Magners.

Or ... would it? Because the notion of a "marketing budget" is rather hazy where a BBC-led project such as Canvas is concerned. As with the launch of Freeview back in 2002, there will be rather a lot of "free" BBC promotional airtime and in-programme plugs to add into the mix.

But that's only the start of the haziness. No-one really knows what Canvas will be. There's a widely understood notion that it's being designed to catapult web-based catch-up television services on to your living room TV. But this is putting the digital cart before the horse because we don't really have a full-blown web-based video-on-demand catch-up service in the UK as yet.

SeeSaw (son of Kangaroo, another BBC-led project that was offloaded on to the BBC's Freeview partner, Arqiva, after a Competition Commission ruling back in February) will be the UK's pre-eminent online catch-up service. And, yes, it's on its way; but, although there's been a flurry of announcements recently, there's still no launch schedule.

Canvas will be SeeSaw writ large - but, as yet, there's no indication of what other types of service it (Canvas) will accommodate. Many commentators fix on the "internet" aspect of the proposal and assume it will offer a means of surfing the web via your living room television screen. It will almost certainly prove less exciting than that. It could end up offering a rather safe spectrum of repurposed programming content available for streaming on demand via an electronic programme guide.

Or, indeed, like Kangaroo, it might end up being blocked altogether by the Commission. But that's not to belittle the progress made last week - all theoretical television services should, at the very least, be in possession of theoretical marketing budgets.

1. Project Canvas has, to date, been a BBC-funded project but three partners - ITV, Five and BT - are committed to participation if and when it gets formal clearance. Back in June, the BBC's governing body, The BBC Trust, warned that the project couldn't proceed unless its managers came up with a more concrete business plan and a clearer strategic vision for proposed services. The marketing budget announced last week, along with other figures, was part of that clarification process.

2. Total costs, including the launch and the first four years of operation, are estimated at 拢115.6 million, a figure that will be split equally among the backers. That's why the current foursome want to attract further partners - and the one they'd like most of all is BSkyB. But Sky's management is, at best, ambivalent towards Canvas and has argued that Ofcom should undertake a market impact study of services proposed.

3. Meanwhile, SeeSaw has announced that it has hired Matt Rennie as its commercial director. He joins from Channel 4, where he has been the business development director, overseeing the distribution of Channel 4's content via new channels, notably YouTube. Rennie joins a management team including the chief executive, Pierre-Jean Sebert, and John Keeling, the platform controller.

4. Maya Bhose, SeeSaw's marketing director, who appointed Vizeum as the operation's media agency back in October, followed that up last week by awarding the creative account to Fallon. She also unveiled SeeSaw's brand identity, including static and animated logos designed by Rudd Studio. The one thing she wasn't able to unveil, as it happens, was a launch date - though, given the fact there's no kit to market, it can, in theory, choose to flick the switch at any time of its choosing.

WHAT IT MEANS FOR ...

CONSUMERS

- The Canvas kit, retailing at between 拢100 and 拢200, is expected to be in the shops by Christmas 2010 - and recent research from Screen Digest estimates that it could be in 3.5 million homes by 2014. Which would amount to puny growth compared with, say, Freeview, which, by the end of 2004, was already in five million homes. Including sets with integrated decoder equipment, there are now more than 29 million digital terrestrial television sets in the UK.

- In other words, this could amount to a rather small earthquake, all told. And the must-have piece of kit for Christmas 2010 is just as likely to be a box that will allow you (cheaply and easily) to patch the browser of your home PC through to your living-room television set.

BROADCASTERS

- So, while most forward-looking TV companies fully expect to see their online video-on-demand advertising revenues growing spectacularly in the early years of the new decade, they can hardly claim to be confident that Canvas will be central to that growth. And they'll surely want to see how SeeSaw performs before committing even modest sums to the Canvas project. So we can perhaps expect to see the BBC's partners dragging their feet, even if Canvas gets the go-ahead from the BBC Trust, Ofcom and the Competition Commission.

ADVERTISERS

- Similarly, Canvas will remain a tangentially theoretical issue for most advertisers and their agencies next year - though SeeSaw could (and should) become the most important new-media opportunity of 2010.

- However, both services offer, at least theoretically, a boost for advertisers in the form of targeted advertising right down to household level.

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