This post is a guest blog from Andrew Cushen, Work Programme Director at Internet NZ.
The Internet has the potential to completely change the model for content distribution here in New Zealand. Content could be one of the "killer apps" encouraging New Zealanders to take advantage of the improved connectivity options available thanks to the UFB rollout. High speed Internet can provide more content, at lower prices, with more choice and flexibility than ever before. Internet delivery of content also completely changes the dynamics of competition in the content market, lowering the barriers to entry and allowing more providers to provide content that may have been uneconomic previously.
In other words, content delivery is one of the pieces of promoting the benefits and uses of the Internet and protecting its potential. We would love to see a more vibrant and competitive market emerge for content in New Zealand, and the Internet infrastructure investments through the likes of the UFB are a big enabler of that. It's for this reason that when Internet NZ thought up our predictions for 2015, we said that big changes are likely in this area.
So; where are we at with this predicted revolution?
For a start, we've seen the market grow in terms of providers. Neon, Sky's online service, launched just recently. Netflix is apparently around the corner - just this morning it was announced that Fetch TV from Australia is expanding to New Zealand and bringing NetFlix with it; LightBox, QuickFlix and Coliseum are already here, there are also thousands of New Zealanders using Global Mode services to access international offerings. New Zealanders are increasingly spoilt for choice. Yes, it's messy - but it's also early in the evolution of this market, and the Internet has made it possible for all of these services to exist. It's more conceivable now to think of this being just the start of a plethora of Internet-enabled content options, offering everything from Hollywood blockbusters to your kids' school play. That's awesome.
We’ve already seen this revolution occur in the music market. When MP3s became the option of choice and people were using Napster to download them illegally, the music industry screamed blue murder and said this was the end. But necessity bred innovation and first we had iTunes offering a method to buy music piecemeal – singles for just over $1 – and then streaming services like Pandora, Spotify and Rdio created an even easier model. All you can eat for a fixed price per month.
Now we’re seeing a similar change in the traditional TV market. Sky has announced that they're "unbundling" their conventionally distributed content. This means that if you're only into sport, there are now options for you to just buy access to some of the sport you want, rather than making a far larger commitment in both time and money to a bundle of other channels that you didn't necessarily want. This is a direct response to some of the Internet-led changes above, and a great example of how the traditional content market is loosening up thanks to the competitive pressures created by the Internet.
Thirdly, New Zealand law has some catch up to do. Online content faces classification challenges that simply aren't the same as those that traditional broadcasters face. This slows down innovation in online content, and increases the costs and therefore the barriers to entry in providing services. That's a shame - luckily, the Minister has said she is onto it, as you can see here: http://www.nbr.co.nz/article/minister-takes-aim-outdated-censorship-laws-cg-168651. And InternetNZ is talking with the Office for Film and Literature Classification about working with them in 2015 to understand what classification really means in the Internet era.
You can see more of the InternetNZ blog at their website here.