Monetizing the 2nd Screen--business models that work

Second screen, social media and companion applications are all high on the agenda of executives in the media and technology industries. As a reflection of all major TV and technology conferences in 2013, CES, NAB, IBC, and MIP had several sessions dedicated to second screen. But second screen, while proven as a reality of consumer behavior, is not yet widely seen as a revenue driver. Indeed the reality of the second screen phenomenon is accepted, as is proven by the continuous flow of statistics showing that viewers use another screen in front of their TV (one of the latest being Nielsen saying that 75% of smartphone and tablet users are engaging with second-screen content more than once a month as they watch TV[1]). Another proof of the generalization of second screen is the multiplication of companion screen applications: over the course of 2013 they have become widespread in new geographies including the Middle East, Eastern Europe and Latin America, where they had little presence only 12 months before. Comparing the space with 2012, it is clear that no TV players can ignore it. Even more striking, the players behind some of the most successful apps are large and well established: Peel now has  40m+ downloads, mostly through a global partnership with Samsung; Apple bought Matcha in August 2012; zeebox grew their partnerships with Sky, Comcast (NBCU) and Foxtel, while DirecTV acquired a share of i.TV (which bought Getglue at the end of 2013); Viggle has a longstanding partnership with DirecTV; Comcast has launched “SEE iT” with Twitter[2] and Xbox SmartGlass app was downloaded more than 17m times.  Despite this popularity and the presence of the largest players, few industry executives dare to speak openly about monetization of second screen applications and only a small percentage of 3^rd party app providers have made their progress public. There may be good reason for the industry stalwarts to keep their progress private with commercial competition so tough, but the sceptics of course believe that is because no one has actually experienced much monetization success.  So while many in the industry are wondering where the money is in second screen, next to nobody is ready to “show [you] the money”.

The purpose of our research paper is to do exactly that: “show you the money”. We review the various monetization strategies used by second screen companion and viewing applications and evaluate how these strategies work and which ones drive the most value.   We also provide an evaluation of the second screen market size and review its main drivers. Finally, we review how Twitter, Microsoft, Samsung and other players not directly in the second screen ecosystem are planning to use the second screen to increase their revenue.

More importantly perhaps, we have taken the time to update our market sizing from last year in an effort to demonstrate where the large opportunities for monetization lay for players in the ecosystem.

Interested in learning more?

Feel free to explore our research and infographics on our website, engage us on Twitter (@ChuckParkerTech, @S32Day), or meet us in person at Mobile World Congress (Feb 26th in Barcelona) or at NAB (April 6th in Las Vegas).

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[1] http://www.rapidtvnews.com/index.php/2013112230974/second-screen-usage-drives-new-online-mobile-advertising-investment.html?utm_source=2nd+Screen+Authority&utm_campaign=9d4a3b97b7-my_google_analytics_key&utm_medium=email&utm_term=0_41ed43776d-9d4a3b97b7-87145145

[2] http://www.eCommercetimes.com/story/79155.html