Market Insight

BBC Store: EST linked to iPlayer

November 16, 2015  | Subscribers Only


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The BBC launched BBC Store on 31 November 2015 as a digital counterpart to the BBC Shop. Containing recent content, archived titles and some productions not previously aired, the BBC Store hopes to capture purchases driven by the shift in viewing to digital platforms. There will be integration between iPlayer and BBC Store platforms; purchased content will be listed under the ‘My Programmes’ section of the BBC iPlayer site as well as in the BBC store.  

Content will be priced from £1.89 for a single episode, to a quoted average price of £7.99 for a six part series in SD with HD content costing more where available. The BBC will also offer a series pass which can be purchased at the start of a series, and episodes will appear in a customer’s content library as they are broadcast. Users will be notified when they attempt to purchase content which is currently available for free on iPlayer. Currently the device support is limited to PCs, mobiles and tablets, but the BBC claims that more devices will be added in the near future. Users will be able to connect up to five devices to a single account and stream programming simultaneously on two of them. 

The BBC Store represents an attempt to capture the expanding digital market and to build on the existing awareness and trusted brand of iPlayer. In 2010 iPlayer received around 70m requests a week; now traffic is more than three times as high and access has expanded to include a range of devices and viewing preferences. As a free service it facilitates around 7m hours (Source - BARB) of on-demand content a week. This corresponds to about half of all content watched on broadcasters’ online catch-up players but is still only equivalent to the live viewing from a single episode of ‘The Apprentice’ (BARB w/e 1 Nov 2015) assuming the audience completed viewing.

With the advent of the VHS recorder in the 1970s, the BBC dipped it toe into the transactional retail business. The BBC's commercial arm, BBC Worldwide, has been selling BBC titles and other merchandise, via shops, mail order and the online BBC Shop for years. Although the physical market has been in decline for some time, it is still worth a significant amount. Last year, according to IHS analysis of BVA/OCC figures, combined sales of DVD and Blu-Ray totalled £1.264bn. The BBC made £21m from Blu-ray sales and £76m from DVD. More than half (63%) of this was made from catalogue titles and the remaining (£35.7m) from new releases. Overall BBC Worldwide commanded around 7.5% of the total UK retail video disc market by value.

As demand for physical video declines, EST, or digital retail, is often touted to take its place. But even though retail commands a higher price point, rental is far larger at £260m for tVoD rental content, against £168m for retail. This makes EST a small segment of the digital market, which in turn is far smaller than that of the physical. The only operator who has reported strong success from digital retail is Sky via their buy to keep service. This bundles a physical copy with the digital download offering both the convenience of instant digital, with the security of physical.

The pricing and selection of content on the new store will also confuse many customers. While there are a number of exclusive titles, including ‘Top Gear’ and some popular cooking shows, other popular and classic titles including ‘QI’, ‘Danger mouse’ and ‘The Clangers’ are not available, although they can be purchased on disc via the BBC Shop. For titles that are listed, often there is no consistency between the price of the disc via BBC shop and the price of the digital copy on the BBC store – as shown in the table below.

Title

DVD - Price (£s) Blu - Ray  - Price (£s) Store  - Price (£s) Price Difference (£s)
Catles In The Sky 12.99 14.99 3.99 9
Dr Who: The Underwater Menace 13.49 - 9.99 3.5
Porridge 4.99 - 9.99 -5
Wolf Hall 10.99 12.99 9.99 1
Edge of Darkness 4.99 - 7.99 -3
Pride and Predudice 6.49 - 7.99 -1.5
House of Cards 9.99 11.99 4.99 5
The Thick of It 4.99 - 3.99 1
Fawlty Towers Complete Collection 12.99 - 14.99 -2
The Mighty Boosh 4.99 - 7.99 -3
Absolutely Fabulous 3.99 - 7.99 -4
Doctor Foster 12.49 - 7.99 4.5

 

In the digital space revenues are dominated by one business model— rental— and two formats that facilitate this: tVoD and sVoD. tVoD has proven unpopular for TV content, only achieving some small success in the movie space. Given this, to achieve anything close to the revenue generated by its physical business, BBC Worldwide need copy the Netflix model and deplop a fully-fledged SVoD service. 

 

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