If mobile phones can be said to be the 'fourth screen', then the fifth screen could be digital signage, which is already being touted as a key new advertising market and yet another revenue opportunity for satellite operators.
For the uninitiated, digital signage involves centrally managed displays that deliver information, entertainment, merchandising and advertising at a targeted audience. Although it's not unlike sticking a TV set in a sports bar, it's not broadcasting in the traditional sense. The content is tailored for the screen and the audience, and the screens can be anywhere. And, thanks to falling LCD screen prices, the spread of broadband and the need for new ad revenue streams, research firm NSR reckons about 850,000 such screens will have been installed globally by 2013.
Fragmented field
At the moment, digital signage isn't an easy sell. For a start, advertisers aren't sure whether it counts as 'above the line' or 'below the line' advertising in their annual media budgets. Meanwhile, the digital signage playing field is currently too fragmented to give them a clear answer. The current hype over sexier digital advertising opportunities, particularly mobile, is proving a formidable distraction as well.
However, digital signage also has several distinct advantages - notably the screen's location at the point of sale and its ability to interact with the consumer directly via SMS and Bluetooth. Digital signage players also claim cost per contact (CPM) is lower than other forms of media - a figure that will get better as screen deployments hit critical mass, NSR says.
Another key element in all this - and one of particular interest to satellite operators - is the cost of running a digital signage network. A recent NSR digital signage report did the math, taking the cost of CPE (screen, media player, connectivity equipment and AV cabling), backbone gear (servers and software form the backbone), installation costs for both, and annual recurring costs like network bandwidth and equipment maintenance.
The actual cost depends on the number of screens and sites, of course, but NSR says that averaged over a ten-year-period, the cost per screen works out to between $2,300 and $3,200 per screen deployed - which in turn means a cost of $7,000 to $10,000 per site, assuming three to four screens on average per site.
As for connectivity costs, NSR found that of the two options it compared - two-way terrestrial vs a DVB-S2 satellite downlink and a terrestrial uplink for the return path - the cost per screen for satellite drops below the cost per screen for a terrestrial link if the network exceeds 4,500 screens, and gets cheaper as economies of scale grow.
'Our estimates peg the current strength of satellite deployments serving digital signs at about 36,000 sites, which translates to about 144,000 screens powered via satellite across the globe,' says NSR sitcoms analyst and report author Prashant Butani.
Granted, this still puts satellite in niche territory. At best, satellite is expected to get the most market share in the outdoor signage vertical space, and even then, NSR says it may capture just 30% market share compared to terrestrial.