Analogue Vs Digital Media Essay, Research Paper

MEDIA WARS

1.0 Introduction

Throughout this report we shall be examining Digital and Analogue commercial satellite television, and evaluating their role as advertising mediums. Our aim is too provide an overview including their strength s and weaknesses, cost per thousand, level of impact and overall contribution towards an above the line advertising campaign. We are the first group to do this topic therefore we have no assumptions about what the results will be.

Brand enforcement needs above-the-line advertising tactics such as these mediums, they help enforce a global message, and give companies a slight gain from economies of scale and scope throughout their campaign. But first we shall provide you with a more detailed description of these mediums.

2.0 Medium Description Satellite

Satellite television became available in the USA in 1980 and in the UK in 1984. An analogue satellite set in orbit transmits its signal towards the earth; a satellite dish placed on the outside wall of your home then receives this. This signal is relayed to the satellite receiver, which is connected to your television. The main advantage this has given us is more channels, which in turn provides wider markets, better regional coverage. Another advantage satellite has given us is the ability to target our market more effectively. This has been achieved through specialist channels such as Sky sports. International influence can be responsible for creating a more diversified culture with foreign influence within the UK. Cable Television also uses Analogue technology offering most satellite television channels. However instead of the user receiving the signal via a satellite receiver onto their television fibre optic cables are laid under ground by the Cable Company, which feed the signal to your Television. A set top box that works similar to a satellite receiver is then used to feed the signal to your television. Cable companies offer a variation of packages including some local stations not available on satellite. The amount a customer pays each month is dependent on the amount and/or range of channels they have access to.

2.1 Medium Description Digital

Digital broadcasting technology arrived in the UK in 1998. Companies such as ON digital and Sky digital are promising to revolutionise they way we watch, listen and interact with our televisions. Sky digital has 350,000 customers, whereas On digital has 110,000 customers. Digital television opens a new interactive scope for advertising, but is still held back by cultural dissimilarities and regional legal restrictions. A problem faced by satellite and cable alike. Until now radio and television have used analogue broadcasting technology. This converts sound and pictures into waves. These waves are received by aerials or satellite receivers and converted into sounds and pictures. Digital broadcasting uses slightly more advanced computer technology. It converts the sound and pictures into Binary digits, and transmits the signal as data. This enhanced system promises clearer picture quality, more channels, as digital channels require less frequency space, and even the ability to watch what you want when you want. Better interaction like this; will hopefully lead to innovative advertising tactics and ingenious marketing strategies. Soon digital technology aims to enable consumers to watch Radio and even browse the Internet from their televisions. The UK claims to offer the best digital package in the world available from Sky Digital.

3.0 Advantages of Medium Satellite

There are many advantages to advertising on satellite, which companies should consider before choosing any other medium.

Large and diverse audience

Satellite and cable have much larger viewing audiences than that of the new mediums, such as digital television. 6.8million homes have satellite, and that means 6.8million potential customers. An estimated 110 million was spent on satellite purchase, and 15 million on satellite rental in 1996.The reach that satellite alone gives us can be seen below:

% Reach of Sky Television

Housewives 15.6%

Men 16+ 22.3%

Women 16+ 14.6%

Kids(4-13) 13.9%

Source:Marketing Pocketbook 1997

Wide range of channels

Due to the wide range of channels available on satellite, the target audience can be more clearly specified, as many of the channels have distinctive audiences. Therefore, specific products can be advertised on related channels. For example, toys advertised on Nickelodeon, and sports equipment advertised on Sky Sports. Research done by BARB shows the share of viewing that satellite has.

% Of commercial viewing in satellite/cable homes

Sky 1

Group Children 16-34 Women Housewives All Individuals

% Share 6.4% 7.4% 6.9% 6.2%

Sky News

Group ABC 1 Men ABC1 Adults Men All Individuals

% Share 2.1% 1.7% 1.6% 1.3%

Sky Sports 1,2 &3

Group 16-34 Men ABC1 Men Men All Individuals

% Share 10.4% 12.1% 10.7% 7.4%

These figures coupled with the fact that 6.8million homes have Sky, helps to give some insight into the potential that it holds for advertising.

Local and global channels

Both International and local companies can advertise on satellite. As well as satellite providing global coverage for international companies, it also provides a forum for much smaller companies. Specifically, cable has many local channels such as Croydon Cable News and the community channel, which provide scope for local advertising.

Low Cost per Thousand

As can be seen from the table below, the C.P.T for satellite is significantly less than that of commercial terrestrial television, around half in some cases. This allows companies advertising on satellite to significantly reduce their costs of advertising.

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Adults Housewives Adults(16-35) ABC1Adults

ITV 5.95 9.6 23.82 16.56

C4 6.02 10.14 20.73 15.35

GMTV 5.68 7.76 26.27 16.30

Satellite 3.64 7.35 8.19 9.45

Source: Y&R estimates (Jan-Dec 1996)

Sponsorship

Companies, who advertise on Sky, have more scope to sponsor the type of programs, which they think enhance the feel of their product. For example Ford sponsors football matches. This also helps to promote global branding. Between 1994-1995, the amount spent on sponsorship doubled, showing how effective it is. Sponsorship also provides close relations between Satellite companies, and the sponsors, which can go way beyond traditional advertiser/media owner relationships. Sponsorship can also enhance or improve a brand image and values, and it acts as a platform for a wide range of marketing activities to build effective promotions. In a multi-channel environment, it can also help target consumers more effectively. It also allows the advertiser time outside the commercial breaks. This makes positive associations with a consumer who may be tired of the amount of regular commercials that appear in a break.

Commercial Impacts

Finally, and probably most importantly, is the commercial impact. Sky commercial impacts are shown below:

13 w/e 14/06/98 13 w/e 13/04/97 % change

Individuals 9,731,551,000 9,192,031,000 + 5.9%

Adults 8,304,835,000 7,779,758,000 + 6.7%

Adults 16-34 3,487,118,000 3,098,547,000 + 12.5%

Men 4,810,275,000 4,450,078,000 + 8.1%

Men 16-34 2,008,434,000 1,731,175,000 + 16.0%

ABC 1 Men 2,038,549,000 1,780,712,000 + 14.5%

Housewives 16-54 3,123,426,000 2,719,684,000 + 14.8%

Source:BARB

As can be seen from the above table, as well as Sky advertising having a high impact, the impact is also growing year on year. The chart below shows us the year on year % change in relation to Sky s % share of total commercial broadcast:

ITV Channel 4 Sky

Adults – 3.1% – 2.2% + 16.4%

Adults 16-34 + 3.6% + 9.1% + 14.9%

ABC1 Men + 0.5% + 5.7% + 19.2%

As can be seen from the above chart, Sky s % share of total commercial broadcast has increased much more rapidly, year on year than commercial terrestrial television.

3.1 Disadvantages of Medium Satellite

These are the disadvantages for companies who choose to use satellite as their advertising medium.

Interference

There is a lot of interference on satellite. It is not as bright and clear, as it is on digital, this means that the quality of the pictures and sound is not perfect.

Target market

You can’t really identify your target market on satellite as well as you can on digital. On digital people have to pay for most of the channels they want to have, so you can see who watches a particular channel. On satellite you can’t really do due to the family orientated packages.

Too many commercials

There are too many commercials on satellite so people get bored or annoyed seeing them or loose interest in them. Many commercials are also very long and it is not good for your product or service, if people are annoyed by your commercial.

Old fashioned, digital is the future

Satellite is old news, digital is the future. Digital changes the way we advertise, it opens a whole New World. Usually you would use a normal television ad to create an image or to give general information about a product or a service. With digital you can actually interact with the consumer, this means you can give the exact information he or she requests in their own language. This would be impossible on satellite. Also you can tell the person for instance where promotion are being held in his or her neighbourhood.

Here are some examples of how you can use digital television as your advertising medium:

An American record selling company broadcast a commercial during the Grammy awards. The commercial allowed customers to directly order a CD.

Another example is of a Danish beer company, they created a commercial where viewers could play a game they did this to launch their new beer brand.

As you can see advertising in this way allows you to measure the response properly so you can see how effective the commercial has been all this is impossible on satellite.

Social and legal issues

If you advertise on satellite there are several social and legal issues you have to bear in mind like:

- CULTURAL DISSIMILARITIES

For instance certain symbols can have different meanings in different countries

- LEGAL RESTRICTIONS

In the UK it is illegal to broadcast a commercial about smoking, but it is allowed in the USA

- LANGUAGE

If it is not your own language it can be easily misinterpreted which can not happen on digital because you can choose you language

- INAPPROPRIATE BRANDING

For instance BMW sends different messages all over the world

Aesthetically displeasing dish

Last is that the dish you need for satellite television looks ugly on your house

4.0 Advantages of Medium Digital

Digital TV is transferred through airwaves in the form of binary codes. Just like computers the language is in the form of 1 s and 0 s. This technique enables a consistently high quality reception, which is free from interference, which you get occasionally from terrestrial TV

One of the most popular features of digital is the amount of channels you can command. The advertising Associations web site on Error! Reference source not found. stated, a given range of frequencies can thus accommodate a much larger number of digital channels than conventional analogue ones. Digital terrestrial TV could command 30 or more channels eventually whilst digital satellite and cable based broadcasting could provide a further 200 each. This basically means the frequency range is much larger than terrestrial. Appendix 1 has 3 diagrams. The 1st diagram is of a normal frequency on terrestrial TV where a channel is found. The 1st section is the part where there is no sound or picture. The 2nd section is the part where there is picture but white (no) sound. Eventually you get to the channel where there is picture and sound. As the frequency is symmetrical, the other side is the same. It keeps on going until you reach the next part where there is picture and white sound. This can be seen in the 3rd diagram. The 2nd diagram shows how when terrestrial TV gets 1 channel, digital television can command 20 channels. This diagram supports the last part of the statement proving how they can command up to 200 channels.

With the fantastic picture quality, CD quality sound and amount of channels available, the future of television is digital. On Sky s official web site, Error! Reference source not found., they are promoting the fact that this is the future, stating, Sky digital brings you a new dimension in quality, TV choice and viewing control beyond anything you have ever experienced or imagined; it is the present, and the future, Digital will transform not only the way you watch television but also the way you use it.

Another advantage is the rapid expansion that digital has had since its official arrival on October 1st 1998. On Error! Reference source not found., a statement from Sky s chairman states, Sky digital is off to a superb start with 250,000 subscribers on December 31st 1998. In the Mirror newspaper (9.4.99), an article titled Digital Watch stated, TV company ON digital announced yesterday it has signed up 110,000 customers since its November launch. It hopes to attract millions more with 2 new soaps. Both of these statements show how fast digital is growing and this not only keeps potential customers aware but also companies who want to use Digital as an advertising medium.

To stand out you need to have a simple proposition which is easy to understand Brand proposition which is complicated or inconsistent, have no chance

(Hugh Davidson)

Digital TV as a whole has a very simple brand proposition. They knew it needed to be set in a clearly identified and understood target market. Three factors of brand proposition that gives digital an advantage are: Functional Attributes, Symbolic Values and target market.

Functional attributes could be clear picture and sound. Due to binary codes, therefore little to no interference. Watching programmes when you want is a key attribute as this benefits both advertising agencies and consumers. Consumers can choose roughly what time they want to watch programmes and advertisers can work out viewing trends and promote then. Interactivity is a potent feature as soon you will be able to shop, bank and almost anything you need just at a touch of a button.

Symbolic Values is the intangible features digital possesses. It is new, therefore fashionable giving the consumer a classy, innovative image. Also the dish is different and more stylish than the satellite mesh dish.

The target markets that digital aims for are the mass market. As they have the capacity to hold a number of channels, they can segment the market. For example, Sky sports aims for the mass sports markets. They can segment this with just having channels for football. They can further segment this by having channels for specific teams. MUTV is a prime example as Manchester United has its own channel.

4.1 Disadvantages of Medium – Digital

The reason why companies chose to advertise on satellite instead on digital is because advertising on digital has to many disadvantages yet.

It’s unknown

A lot of people don’t know digital yet, so why advertise on digital if you can’t reach your customers?

New

It is to new yet, you don’t know if it will become a success, it is a big risk to advertise on digital because if it goes wrong it can cost you a lot of money.

Set-top-box

People need to have a digital set-top-box and a dish that connect to their television, this is very expensive it will cost about/approximately two hundred pounds to buy and than you have also to pay a monthly charge.

Too early to measure your viewers

It is to early to measure your viewers yet, because the system that measured viewing was designed to record the frequency of each analogue channel, but with digital, several channels are carried on a single frequency and the meters cannot separate them. So the results you would get are not truly representative of the views on your market.

Too many channels

There are so many channels, the change that people see your commercial or advertisement is not big. Also digital television brings more channels which show the same programmes over and over again, if you have a specific market and you want people to see your advertisement, you have to broadcast it on all the channels and that is very expensive.

No experience in advertising on digital

There is not a lot of experience in making advertisements on digital yet, you don’t know what the best way is to make an advertisement on digital. If you make a wrong advertisement it can damage your companies name and image.

Adidas re-invented their traditional approach to pan-European advertising. Now we will tell you what their situation, objectives, strategy, tactics and their target market are using the help from P.Smith in his book, Marketing communications.

Situation: Adidas is the global operating market leader in the manufacture of sport shoes, sports wear and sporting goods.

Objectives: The first important objective for Adidas is the maintenance of creative standards and second to ensure that this is effectively and efficiently administered. They also want a deeper totality of image and they want to reinforce their position at the heart of sport, innovating in a way that surprises, challenges and entertains youth.

Strategy: Because of the rapid integration of European youth culture for example same brands, sport tastes in music and fashion tends reoccurring in country after country, this had obvious implications for the development of a unified Pan-European strategy for Adidas. Adidas exploit the tension that exists between the different aspects of the brand, these being youth, sporting heritage and product innovation.

Tactics: Adidas chose a multi-executional approach. Instead of the same message being repeated over a series of advertisements, they had over the last two years developed a large number of advertisements with different messages. From literal to lateral expressions of sport, fun to serious tones of voice, through to the latest product technology. Last year they produced 50 different TV commercials and 150 press advertisements running virtually every market in the world.

Target market: Very simple every one but most of all youth.

Satellite enables the strategy and tactics to be deployed on global scale and the dynamic technology complements the dynamic product.

5.0 Future Developments

As we have previously seen in the prior articles, there are currently some exciting developments in the particular with reference to the growing Digital Television revolution. Marketers are already beginning to realise the potential of such a medium. With greater exposure of more channels Digital Television is perfect medium for marketing communication. But with such expansion in technology what possibly can the future bring and what application and benefit might a marketer gain and have for these developments.

The most obvious and current development in the commercial television sphere is the increase of interactivity. With this we see the development of British Interactive Broadcasting. BIB will play a key role in establishing a base of digital satellite set-top boxes and will supply interactive content to digital platforms; BIB will distribute the service on digital DTH.

British Interactive Broadcasting (BIB) was formed on 7 May 1997 to deliver interactive services in the digital environment. British Sky Broadcasting Group owns 32.5% of BIB, the other partners in the venture being British Telecom (32.5%), HSBC Midland Bank (20%) and Matsushita Electric (Panasonic UK) (15%). In return for service distribution on BSkyB’s new digital DTH platform, BIB will provide the technical infrastructure for interactive services, and will enable digital set-top boxes to be sold at a retail price of approximately 200. Essentially, the set-top box converts digital transmissions into analogue signals, which can be seen on conventional television sets. With the launch of BIB, digital satellite transmissions will also enable the customer to access an array of interactive applications. These should include interactive home-delivery shopping services, television banking, holiday reservations on-screen, learning on-line, computer games and ‘the best of the Internet and e-mail’.

Despite this, for true interactivity, many believe some sort of PC is inevitable and the computer industry believes it knows the shape of the future. “There are soon going to be three types of device on the market,” says Bob Sterns, senior vice-president for technology and corporate development at Compaq. “PCs capable of doing TV, devices which merge the full capabilities of both, so they have a big screen and can be controlled by a remote control but have full computing functionality, and TV appliances, intended solely for digital TV use, but which contain some basic processing capabilities.”

Microsoft has incorporated support for digital TV into Windows 98, due out early next year. It has also enabled the next version of Internet Explorer with buttons that look very much like channel select buttons on your TV. These can be set up to point at Web-casting sites and essentially be used to bring different TV channels on to your PC.

Web TV is probably the best known of the boxes to bring the Web to your sitting room. Microsoft bought Web TV Networks earlier last year for $425m. A Web TV box is essentially a stripped-down computer that allows you to access the Web over your telephone line and display the image on your TV. It will be released in Europe later this year.

However Web TV will be coming into what could soon be a crowded market. NetStation, a system developed by Acorn founder Hermann Hauser, is attracting a lot of attention, while in France NetGem has its own solution. Nokia will be adding Web browsing to its Digital set-top box next year and there are many others.

Digital TV will also bring in totally new ways of delivering the Internet. BIB proposes several ways – none as yet finalised. Its most basic service will involve some 20 Web sites (totalling perhaps several thousand pages). These will be broadcast over the air in a sort of carousel with some information stored in the set-top box’s memory, like a sort of super teletext. One of BIB’s main claims for this service is that it is a “walled garden”. The company will know exactly what is on show and will make sure there is no unsuitable material. “Most of the Web’s most popular sites are pornographic ones,” says Chris Townsend, acting commercial director of BIB. “The regulator [the ITC] is very keen that we do not put anything on the screen that might cause offence.”

In the US, cable modems, typically with speeds of between 10 and 30Mb per second, are just beginning to find their way into homes. This makes it possible to have incredibly smooth images and sound broadcast through the Internet giving the potential for thousands of programmes produced from thousands of locations. The potential for marketers is incredible. Through this incredible possible range of programmes individual segments can be directly marketed. Perhaps even sending programmes with advertising to particular homes.

6.0 Presentation

As part of this module, we had to do a presentation. As it had to be for an hour, all of us thought it would be boring to each have an individual piece and read it to the class. We decided that one of the most popular aspects to come out of satellite was the Jerry Springer show, so we decided to do our presentation Jerry Springer style.

Over 10 weeks we met roughly 2 3 times a week and came up with not only material, but also how we would present it. As it was the style of a Jerry Springer show, we needed an argument. We decided that a good argument would be Satellite/Cable TV Vs Digital TV. This was going to be backed up with two representatives from Satellite/Cable and digital, respectively and advertising agencies on one of the mediums, criticising the other medium. Also we had a host, a floor manager, a cue cards man and security guard.

We used a number of visual aids and pieces of equipment to help with the presentation. They were:

+ A Laptop Computer with PowerPoint was used instead of an overhead projector to communicate important notes to the class.

+ Cue cards

Used to get audience participation. For example, cards saying applause, Jerry

+ 3 Video cassettes

1 Past clips of Jerry show. Used to tell audience how on past shows people have lost their temper with these subjects. We used clips from Jerry Springers Uncensored video and dubbed the sound out and used the instrumental from Eminem s song, My name is .

2 Satellite link up. Used for an example of Digital’s interactive abilities. Filmed on a previous date, where a group member, posing as an international agent, talked about the advantages of digital. Another member of the group, posing as a digital spokesman, interacted with them by not only conversing but also actually stepping into the TV, and pulling out the agent and both continuing there conversation to the live studio audience.

1 Video of adverts. Used at the advert break.

With all the material and information we included, it fulfilled all the criteria needed for the course plus more. Some parts were more noticeable than others were. For example, the advantages and disadvantages was a big section of the presentation but the international perspective, was on going throughout the whole presentation, due to satellite and digital being broadcast internationally.

In appendix 2 we have given you a who’s who run down, explaining in the layout. Due to unforeseen circumstances, Jemma could not make the presentation so we had to take her bit out. Looking at appendix 2, her part would have been before Andrew D and she would have talked about the advantages of Digital. We had planned alternative presentations just in case a member did not turn up, so we had to use it.

Conclusion

Having being the 1st group to do commercial satellite as an advertising mean, we had no past reports to have a basis on. We had to set a precedent. Deciding to use digital TV as well as satellite was a cohesive decision, which we thought would be beneficial. We covered all aspects of the syllabus and made this report different from the presentation, but still covering the same aspects. Due to this we found doing the presentation very helpful towards the report.

As we were doing a fairly new subject, books were hard to come by. A few books mentioned brief parts about satellite but we did not find sufficient or relevant information about digital. The majority of the research conducted was off the internet and we found the sky web page, www.skytv.com, especially helpful.

Advertising on satellite has its advantages. We came to the conclusion that its main advantage is it being a popular, profitable, well-established advertising medium. Other advantages are the scope it gives companies to sponsor, low cost per thousands, wide range of channels and the commercial impacts. Satellite has its disadvantages though, too many commercials, interference and the introduction of digital.

Digital is the future and has many new features to offer not only the subscriber but also companies who wish to use it as a medium. The scope of digital is immense and far too deep for this report. It has a very bright future and will change the way in which you use and watch TV. As digital is new, it is too early to measure your viewers, therefore do not know how many people are watching. Even though Digital has a huge scope and has a lot of new, innovative features, the majority of them will not be available until the long term. Companies have to keep this in mind before deciding what medium to use. If they want an established medium, then satellite would be the best choice but if you want to advertise in the future using different methods or you are a new company wanting to penetrate the market, then digital is the best medium.

Bibliography

Smith,P (1993), Marketing Communications an intergrated approach, Kogan Page

Advertising Association (1997), Marketing pocketbook 1998, NTC Publications

BBC (1998), BBC online sales package

BSB (1998), Sky Digital sales package

References

WWW.DigitalTVReport.Com

Authors Shaun Match, Andrew Akuffo, Andrew Davis

WWW.Sky.co.uk

WWW.BBC.co.uk

WWW.Telewest.co.uk