The FINANCIAL — Georgia’s first video portal Myvideo.ge has entered the streaming media business by launching Myvideo TV Box, based on OTT (Over the Top content) technologies.
The company is sure that by adding new interactive elements to TV screens the younger generation will be encouraged to return to this particular viewing device. The current reduction in growth of IPTV (Internet Protocol Television) contrasted with the rapid enlargement of OTT on the global market makes the Myvideo.ge team optimistic that in two-three years’ time OTT will overtake IPTV.
“Our product is different from IPTV. The modern generation has moved from television screens to different devices. We would like to change the ongoing trend. Our services are focused on that. TV screens will become as personalized as tablet or PC devices are. OTT offers such a high level of interaction which cannot be supplied by standard IPTV, despite its vast resources. That is the main difference between OTT and IPTV,” Mamuka Monavardishvili, Director of Myvideo.ge, told The FINANCIAL.
“Even the business models of IPTV are different. They approach their customers as subscribers and offer more massive products. Therefore we are their indirect competitors and are thinking about capturing a different segment. It will be the younger, technology-driven generation. It will take two-three years for consumers to get used to new TV-viewing habits. After that, we will become more serious competitors of IPTV. In general, different technologies are the competitors of each other. The global trend shows that the growth of IPTV has stopped, contrary to OTT which is increasing very quickly. In some countries the annual growth rate of OTT is 20-30%,” said Monavardishvili.
Myvideo TV Box offers a package of 100 channels. Low prices, simplicity of usage, portability, interaction and multifunction are the main advantages that the new product boasts. “Technological development in Georgia lags behind world trends by several years. Accordingly, IPTV is still on the rise in Georgia. After a certain period though this growth will stop, like it has in developed countries,” Monavardishvili said. The first and most popular Georgian video portal Myvideo.ge was established in 2006. Currently its number of daily unique visitors is 200,000, while the annual number is 1,300,000. The most viewed video has amassed 612,000 views.
In his interview with The FINANCIAL, Monavardishvili talked about the company’s plans to return the young generation’s interest to the TV. He also analyzed the internet market and the company’s work in Azerbaijan.
Q. Why did you decide to enter the streaming media business?
A. Myvideo TV Box is based on OTT technologies. The current global tendency shows that OTT technologies are the most recent trend in broadcasting. The consumption of OTT technologies is growing very quickly. Whereas 2-3 years ago OTT content made up just 20-25% of various devices, currently it makes up 50%. This clearly shows that trends are tending towards the digital. We can say that the Georgian market is not ready for that yet, but we always try to surpass upcoming trends. Our company is focused on development. Therefore we started working on implementation of this content two years ago. The right partners and appropriate products had already appeared on the market, which enabled us to implement our new product.
Q. The number of television viewers is decreasing annually as the population is switching to computers and other devices. Don’t you think that it is risky to implement a service for TV broadcasting against such a background?
A. We are trying to change the stereotypical perception of TV. Each device has its own form of usage. Smartphones or PCs are more personal gadgets, while TVs are more family devices. Meanwhile, in the event of adding some extra interactive options to it, it will manage to attract the young generation back to it. Modern TV already offers the service of watching whatever and whenever we want. Additional services of our programme are that we offer multi-screen technology. By this, all the services of a smartphone get linked to the TV screen. For example, we can start watching a movie on our smartphone, then pause it and continue watching from the same paused moment, but on the TV. Such opportunities give people extra motivation to return to watching TV. TV is no longer a linear device on which we can only watch whatever is being broadcast.
Q. How would you estimate the internet advertising market in Georgia?
A. Advertising revenue changed significantly during 2014. Currently the growth has stopped due to the existing economic difficulties. Ad sales did not increase significantly in 2014 compared to 2013. The growth rate was greater in previous years. However, overall it is clear that the internet advertising market is growing. If economic conditions hadn’t interfered, then the growth rate would be much higher.
Today we have included almost all of the business segments’ advertisers. Nowadays everyone can see the effectiveness of internet advertising. Myvideo.ge is not the kind of site that is focused only on young people. It covers the whole population. About 3-4 years ago, banks and insurance companies had less advertisements placed with us. Today they have realized that our customers are their target segment. The second factor is that the trend of watching TV and accordingly, advertisers, is decreasing.
Q. You have established an analogue of Myvideo.ge in Azerbaijan. How would you evaluate your work there?
A. Myvideo.az is among the top five most popular websites in Azerbaijan. This is similar to the Georgian site. Currently there is a problem with broadband internet connection in Azerbaijan. Our site requires huge resources because of its heavy content. Thus Broadband internet is necessary. Implementation of optical internet only started in Azerbaijan in 2014. Mostly providers offer DSL, which is low quality. TV channels broadcast via Myvideo.az use this as a platform for spreading channels abroad and inside the country. Accordingly the website is very important.
The internet boom in Azerbaijan is starting now. Due to their economic conditions the Government spends a huge sum on providing regions with internet. They are paying huge attention to it. The advertising market in Azerbaijan is still small. It makes up around a fifth of the Georgian ad market. We expect the internet boom and plan to be well-prepared. The main advertisers are mobile operators, shopping networks and similar companies. In general, the Azeri telecommunications market is closed. We have local partners there. You cannot start a business there without having a local partner. There are over 100 TV channels on Myvideo.az. Only 10-12 are national. New internet channels were launched that are broadcasting only via our site.
Q. Myvideo.ge might be a popular site for now, however consumers quickly get used to innovations. How do you plan to transform it?
A. The archives and scroll of TV programmes has and will continue to work fairly well up until a certain stage. The largest pay TV abroad is Netflix. It does not have any TV stream, they directly upload content. We think that the archive and scroll method will slowly switch to this system. One of the biggest advantages is that we are directly making products and are not dependent on anyone. Right now we will actively continue to improve our services for mobile users. Currently the number of mobile App users is over 300,000. This is quite a big number for the Georgian market. We will soon offer a new application on the App Store.
Q. What are the main obstacles for developing the IT sector in Georgia?
A. We have quite a big shortage of human resources. The biggest problem in Georgia is in the education field. There is no one place where we can find an appropriate candidate for our jobs. That was the reason why we established a special training centre. However, this is not only a problem in Georgia. There are some exceptions like the U.S. and other developed countries, but the problem is common in every developing nation. In general, technologies are developing so fast that the education system cannot keep up.
Q. What’s your opinion of the quality of internet on the local market?
A. The quality of internet in Georgia is quite good. However, there is a need for greater coverage. There are some areas in central districts of Tbilisi where high speed internet is not available, not to mention in the regions. As the regions are densely populated though, providers are finding it worthwhile to enter them. Places supplied with optic internet have quite good quality internet. The problem mainly exists in areas still supplied with DSL.
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