With over 400 million people predicted to have Smart TVs by 2016, there is an impending "appification" of the TV that presents an enormous opportunity for brands, content creators and media companies. But chances are, few reading this blog have considered rethinking their content strategies for Smart TV consumption, not to mention the accompanying monetization models.
In part, that's because much of the skepticism about the value of the technology is justified. It's true, for instance, that many Smart TV components remain underutilized by consumers. The most successful apps have been video apps, such as Netflix. Software development for anything more complicated than basic streaming -- especially gaming -- has been a challenge because of Smart TV's notoriously slow (and quickly out-of-date) hardware. But manufacturers remain committed to the technology, and are taking significant steps to correct its flaws.
The latest report from IHS Screen Digest predicts that Smart TVs will account for 55% of the market by 2015 and by 2016 will account for two-thirds of the total units shipped globally. In addition, relatively inexpensive auxiliary devices like the Google TV box and the Xbox can turn any TV into a Smart TV in less than 15 minutes. An expected updated Apple TV that would run the iTunes ecosystem would accelerate Smart TV adoption. Inevitably, Smart TVs will become a key component of many households' connected-device ecosystem.
Like any other platform, successful content and brand experiences on Smart TV will require a carefully calibrated strategy that capitalizes on the medium's strengths. In essence people want TV experiences on their TV -- not tweets and Google searches.
Smart TV will allow for more innovative approaches to video advertising that take full advantage of the platform. This might include contextual pop-ups and overlays that not only function as promotion, but also enhance the viewing experience. Expect native advertising in coming years that is integrated into a wide range of unimagined apps that are contextually aware of what you're watching, or even completely new stand-alone experiences unique to the Smart TV.
But success in any of the above requires marketers to be proactive in shaping content to platforms. Someone in the organization has to own the issue, and outline a plan for engagement -- not just for Smart TVs, but for the entire connected ecosystem.
The connected ecosystem is centered around the idea of different digital devices and platforms communicating and operating together in a seamless fashion. While the walled gardens of iOS, Android and Windows still separate many apps and software by operating system, that fragmentation can't last forever. Many are predicting that the web app code will be the foundation for all app development going forward; this will serve to produce much tighter integration across platforms.
Smart TV can and should be the critical link in that chain, as video spots remain the most effective form of advertising. As noted, one of Smart TV's important comparative advantages over other digital devices is its multi-user experience. People gather in front of a television to watch their favorite shows from movies to sporting events or play video games. Smart TV lives in the home, and it should be the central hub for consumer engagement.
The next few years will be critical in Smart TV development. Internal "Smart" systems will either meet hardware demands and catch on, or be replaced by Google TV, the next Apple TV, gaming consoles, or other point-of-access devices that circumvent the TV operating system. Either way, the television will be at the center of the connected ecosystem.