For a long time, broadcasting was a clearly defined sector of the media industry with its own organisational forms (public service and commercial broadcasters), its own broadcasting channels and specific devices for the broadcast content.
Digitisation not only overcomes spectrum scarcity the shortage of broadcasting frequencies, but also supports enhanced image quality (ranging from high definition to 3D TV). The development of broadband networks have created the means to disseminate audiovisual content via the internet; moreover, rather than content being time-and-channel-based, it can now be accessed by each indi-vidual user as desired. Broadcaster content can be accessed on a variety of devices, from the classic TV screen in the living room to mobile devices such as tablets and smart phones. By connecting televisions to the internet, the smart TV (or connected TV) can access media libraries as well as Video on Demand platforms. The range of potential options is being expanded by game consoles with TV integration and advances in user-friendly high-powerstorage technologies.
As the borders between the media dissolve, new conflicts of interest emerge — for instance, between publishers and public service broadcasters, which both offer web-based platforms with news and moving image media.
The previous system of funding public broadcasting by a licensing fee linked to receiving devices has been replaced by a flat-rate contribution for all households. Since under the original receiving device model, Berlin suffered from a higher than average shortfall in fees paid, the city expects the new system to have an especially positive impact on the public service broadcasters.
Digitisation has left its mark on the business models of all privately financed media. In contrast to print media, hours of use for audio-visual media have largely remained stable with time and channel-based TV even registering increases in hours of use, though not among the younger target groups. But broadcasters are facing new challenges, with radio broadcasters competing with music platforms, or TV stations challenged by the new global Video on Demand platforms.
The larger the range of digital services, the more important discoverability becomes. As a result, the influence of navigation instruments and search machines is also increasing in the audiovisual sector.
At present, there is a shift from transport models, where each user pays for a comparable transport service, to marketing models, where broadcasters have feedback on coverage and the conditions between network operators and platforms as well as content providers are the subject of negotiations. This transition is creating new challenges for the equal treatment of all communications transferred over the network (net neutrality).
In 2012, Berlin’s broadcasting industry 1, which includes the market segments of broadcasters, TV producers, freelance journalists and press photographers, generated a total turnover of 1.9 billion euros from approximately 1700 businesses. Since 2009, the number of companies in this sector has decreased slightly. In contrast, by 2012 sales had risen by 13 percent and, by 2013, the number of jobs in the sector had increased by ten percent.
In the wake of concentration processes and the commercial broad-caster SAT 1 relocating to Munich, Berlin is no longer home to any of the major private broadcasters. Nonetheless, the city remains a very attractive location for developing new content and business models.
AXEL SPRINGER, now one of Europe’s largest digital publishing houses, developed its involvement in moving image media both though dedicated football content available on the BILD.DE online platform as well as through a cooperation with DIE WELT and N24. Similarly to AXEL SPRINGER, German mass media company PRoSIEBENSAT 1 became intensively involved in venture enterprises, employing its media channels to market start-up services. This process has also created particular opportunities for Berlin.
Radio broadcasting in Berlin-Brandenburg
The Berlin-Brandenburg metropolitan region continues to have the most vibrant and diverse — as well as most competitive — radio landscape in Germany, with over 50 radio channels broadcasting their schedules via FM and / or DAB. Due to their contribution to diversity, broadcasters such as FLUXFM and RADIO TEDDY are also allotted frequencies in other German federal states. The listening time has largely remained stable at 183 minutes a day. This figure has dropped among younger target groups, although the decline has significantly slowed. Given demographic trends, there are no grounds for concern here at present.
With a share of 56 percent, commercial broadcasters in Berlin account for a proportion of the market far above the national ave-rage in Germany; among the public broadcasters, the share of the Berlin-Brandenburg public broadcaster RBB remains stable at 32 percent. In the meantime, PROSIEBENSAT 1 has located the centre of its digital development, including its games sector, in Berlin. The figures on revenue development again show increases for commercial broadcasters across Germany since 2008, though the returns have not reached the peak levels recorded in 2000. In contrast, public service broadcasters were able to significantly increase their revenues since 2000, earning nearly three times as much as the commercial radio broadcasters. Private broadcasters remain dependent on advertising revenues, with hardly any new business models in sight.
The net per capita average for advertising revenues on radio amounts to 10.80 euros in the Berlin-Brandenburg region, which is significantly higher than the national average. Radio broadcasters also profit from the favourable economic development in the Berlin-Brandenburg metropolitan region. Since 2010, private broadcasters have again created more jobs for full-time employees and, in total, now employ over 500 people. According to the economic analysis of the regional radio market commissioned by the Medienanstalt Berlin-Brandenburg, the level of cost effectiveness in Berlin-Brandenburg rose on average in 2012. In general, though, the larger broadcasters are also in a healthier position financially. Radio broad-casters leverage synergies through the joint utilization of broadcasting centres, cooperations on producing news programmes and, in particular, in the way they market advertising. However, the range of broadcasters not only includes networks of affiliated stations, but also individual companies broadcasting a dedicated programme schedule on one channel.
The Berlin-Brandenburg region offers a wealth of programmes available through the upgraded digital radio technology DAB plus. As yet, though, the numbers of devices in use do not justify funding a dedicated DAB plus programme schedule. Listening to the radio via the internet is gaining in importance. The frequencies 88.4 and 90.7 MHz are for non-commercial broadcasting. Their overall use is not only designed to include public access TV and radio broadcaster ALEX OFFENER KANAL BERLIN, but also a variety of non-commercial formats which, with their prioritising of the spoken word, also refl ect Berlin’s cultural diversity.
Regional private television in Berlin
Regional television continues to face difficult conditions generally. This is not least due to the lack of support from large supraregional broadcasters for providing a slot for regional programmes similar to that commonly found in the former West German federal states. Nonetheless, in the Berlin metropolitan area, the funding received by regional public service broadcaster RBB alone puts its ahead of the commercial competition. Moreover, in contrast to private broadcasters, RBB’s membership of the ARD organisation of Germany’s public service broadcasters provides it with access to attractive supra-regional programmes. With the regional station TV BERLIN returning continuing losses, it was declared bankrupt.
At that point, FAB, a second Berlin broadcaster, had already exited the market. However, during TV BERLIN’s bankruptcy proceedings, the broadcaster was successfully re-structured. In the non-commercial sector, ALEX OFFENER KANAL BERLIN not only offers a showcase for young talents and events from the city’s creative scene but also, for example, broadcasts debates in the Berlin House of Representatives.
Public service television
In addition to regional broadcaster RBB, the ZDF Berlin Studio (run by Germany’s second national public TV broadcaster), and Germany’s international broadcaster DW (Deutsche Welle), a number of other public service broadcasters are active in Berlin producing topical news programmes as well as commissioned productions. After SAT1 relocated to Munich, the RBB is now Berlin’s largest employer in the television sector.
Private supra-regional television
The PROSIEBENSAT 1 Group decided to relocate Berlin-based broad-caster SAT 1 to Munich as a cost-cutting measure, simultaneously concentrating all the Group’s TV broadcasters at one location and facilitating a full exploitation of synergies. This move led to down-sizing staff in Berlin and, in some cases, a drop in production com-mitments. News channel N24 remained in Berlin. Initially run as an independent company, N24 has now been taken over by AXEL SPRINGER with the aim of leveraging future synergies with the WELT Group. MTV was restructured by its parent company VIACOM, and no longer relies on advertising to provide the main source of funding. On the other hand, Joiz has founded a new TV broadcaster intensively utilising the distribution channels offered by the internet and social media networks. As yet, approaches to special interest programmes have only proved successful if they could also access the resources, for instance, of U.S. studios, or could profit from synergies as part of a network of affiliated stations. In Berlin, ARD, ZDF and a variety of other producers founded the company GERMANY’S GOLD to provide a Video on Demand plat-form to market TV content. However, the Federal Cartel Office (BKartA) has blocked the project on the grounds that it contravened German competition law.
In a survey carried out by the Medienanstalt Berlin-Brandenburg, 75 percent of Berlin’s TV producers agreed that the price for each production minute paid by the purchasing broadcaster had fallen over the last five years, especially in the areas of documentaries, features and news reports. On average, the majority of TV producers generate 75 percent of their turnover from their three largest customers.
The emergence of numerous start-ups developing recent innova¬tive ideas such as Social TV, 3D TV or IPTV can be regarded as one positive effect of the competitive nature of Berlin’s TV sector. In some cases, these new businesses then work together with established companies, playing a role in shaping the future of the German broadcasting market. In this context, TAPE.TV, TWEEK or FRESHMILK NET TV are prominent examples of successful start-ups.
Developing transmission channels
Berlin played a pioneering role in the shift to the digital trans¬mission of terrestrial television, with the city being the first in the world to switch off analogue television transmissions. Since then, DVB-T has grown successfully with nearly 20 percent of all households at least receiving digital terrestrial transmissions; for over half of these, this is their sole channel for receiving TV broad¬casts. Switching over to digital transmission and cutting analogue satellite transmissions of television entirely in 2012 was a more significant step for Brandenburg than Berlin, where only around eight percent of the households received television via satellite. The key transmission channel is still broadband cable. The proportion of digital TV households has continued to rise, but has not yet reached a figure where a concrete switch-over date could be considered.
Advances in broadband internet also play an important role in media sector developments, since cable technologies, particularly in terms of cable efficiency and capacity in comparison to telecommunication providers, have fuelled an increase in market share. The proportion of households receiving TV via high-performance telephone lines, in particular DSL, is constantly growing and, by 2013, had reached five percent.