"All your TV in one place." Really?

Apple and Sky are just a couple of the big names promising to deliver this simple concept: a single place to find, discover, and watch all the TV and video you could ever want or need. How hard could it be?

These wannabe "super-aggregators" are right that there's consumer demand. An Ovum survey found high interest for TV services that include access to Netflix, YouTube, and other sources, especially among the much-coveted 16- to 34-year-old demographic (see the figure below).

It's also what many industry players need. Most consumers just won't have the time or energy to seek out and manage multiple TV and video apps. But industry dynamics in the form of rivalries and tensions will also make achieving true "super-aggregation" elusive.

"I don't want to live in a world where someone else is making the world a better place than we are."

The above quote from Gavin Belson, the fictional CEO of the Google-like Hooli in HBO comedy series Silicon Valley, sums up these rivalries. Too many companies are too invested in the future of TV – technically, financially, ideologically, and perhaps even emotionally – to hand control to a third party, even if it might be the right thing to do.

Take these three sources of conflict:

• Competition to redefine discovery. Experiments with social-like feeds, live-streaming channels, curated playlists, and other novel ways to present video content will only grow in number as service providers seek to make their apps the ones viewers most want to open and least want to leave.
• The left-field going mainstream. The coming years will also see the growing popularity of video apps that are less about traditional passive viewing and more about engagement with social networking, gaming, shopping, as well as other digital activities, and so less suitable for "super-aggregation."
• Big apps playing hard ball. A handful of major service providers may prevent their apps from being aggregated, if they decide that any boosts in subscription numbers or viewing aren't worth the loss of control over the user experience, access to viewing data, and costs to their margins.

Apple TV: less like a Spotify for TV, and more like Yahoo!

The Apple TV app is a case study about the challenges of "super-aggregation." It feels less like its clean, simple "all your TV in one place" promise and more like an old-fashioned web homepage, a collection of thumbnails linking to wildly different destinations.

Competitive concerns mean the app is also missing Netflix – a major omission given many consumers say it's one of the three TV and video services they watch most (see Ovum's "On Netflix's quest for 'moments of truth'" https://www.dhirubhai.net/pulse/netflixs-quest-moments-truth-rob-gallagher/).

As Netflix CEO Reed Hastings explained earlier this year: "We've chosen not to integrate into their service because we prefer to have our customers watch content in our service."

What's next for TV "super-aggregation?"

Here's what we at Ovum expect:

• Tech-giant platforms will make progress but will remain patchy. The likes of Apple TV and Amazon Channels will attract more partners as they invest in features and marketing to make third-party apps easier to discover, pay for, and watch. But high-profile holdouts might take years to get onboard – if at all – while they remain unsure about the tech giants' ultimate goals.
• Love them or loathe them, pay-TV operators will be well placed. They might not be the fastest-moving, but the original TV "super-aggregators" have powerful assets others lack: large numbers of paying subscribers, connected TV devices in use, and trusted relationships with content providers. Similarly, Roku's relative neutrality (compared to the tech giants) will serve the streaming-platform start-up well.
• "Tech tolls" will drive major apps to go direct-to-consumer again. Concerns about the amount of subscription revenue "super-aggregators" claim from third parties using their platforms will eclipse those about user experience and viewing data. Given such charges can run up to 30 cents on every subscription dollar, apps will embrace these first as a necessary evil, then as a cost to be cut or avoided as they gain scale.
• The awakening of the sleeping giant of "super-aggregation": Google. The digital ad-giant already has major building blocks in place: its advertising and Play app store platforms, extensive cloud and network infrastructure, and a growing base of Android TV devices. It's relative flexibility on subscription billing – asking for only an optional 15% share compared to Apple's mandatory 30% – will also help its cause.
• Consumers will embrace "super-aggregation"- and fragmentation. Amazon, Apple, Google will be among a handful of other "super-aggregators" will come to dominate the online-video landscape, but so will a handful of single-brand apps that consumers continue to access direct, such as Netflix, Disney+, YouTube, and Twitch. Many people will use both methods - while continuing to watch broadcast TV.

The final challenge for "super-aggregators" is that the world of TV is not flat. The partnerships that service providers will form, and the viewing choices people will make, will vary greatly by country. Only one prediction will apply worldwide: delivering on the promise of "all your TV in one place" will be easier said than done.