Ad industry braces for online impact of Smart TV

"This development will become a threat to the TV advertising industry in a couple years as people spend less time watching TV shows but go online more even though they’re sitting in front of their television set," Sohn Chongsrichan, chief business adviser and brand strategist at Y&R Thailand, a leading ad agency, told The Nation yesterday.

With a smart TV, viewers can key and update their status on Facebook, text messages via Twitter and download and play missed TV programmes on YouTube.

Content providers, advertisers and brand owners will need to rethink ways to create brand communications, he said.

TV manufacturers are seeking partnerships with production houses to provide digital content via applications on smart TVs. Digital content includes clips of TV shows, news feeds from local newspapers, movie trailers and video streaming.

Adisak Limprungpatanakij, president of Nation Broadcasting Corporation, said Nation Channel, Mango TV and Asean TV, which are run by the corporation, had been providing digital content for Samsung, Sony and LG smart TVs for two years.

For smart TVs to become a fully effective communication device, the broadband Internet network will have to be improved, he said.

Recently MCOT, the operator of Modernine TV, and Panasonic (Thailand) launched a smart TV app called Smart Viera that transmits news and variety shows, situation comedies and video on demand via the Internet.

Chakraphan Yomchinda, vice chairman and acting president of MCOT, said this app would be able to reach new-generation viewers and could be the start of providing exclusive content via pay-TV services that would generate new income in the near future.

TV makers say that in a couple years, they will spend heavily on marketing smart TVs and team up with local production houses to provide exclusive content.

Alongkorn Chujit, deputy managing director of LG Electronics (Thailand), said that under the company’s three-year marketing strategy, smart TV devices would spearhead its expansion in the country, particularly in major urban areas.

"We have seen high potential for growth in this segment in the past couple years. In 2009, LG’s smart TVs accounted for only 5 per cent of total sales in the audio-visual segment. Last year, the company witnessed an increase to 20 per cent. This year our sales contribution is estimated to reach 30 per cent," he said.

LG’s smart TVs will contribute up to half of all TV sales in three years, he predicted.

According to IPG Mediabrands, the media innovation unit of Interpublic Group, last year more than 700,000 smart TVs were sold, of which 200,000 were from Samsung, 216,000 from Panasonic and 120,000 from LG.

Alongkorn also forecasts that a million smart TVs will be sold in the overall market this year.