Product life cycle - end of the line for Teletext
Friday, July 17, 2009
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After 35 years of providing TV listings, sports results and weather forecasts, the analogue information service known as Teletext is to be closed…
It seems like only yesterday that you would flick over to Teletext (or the BBC’s version known as Ceefax) for the latest cricket scores, last minute holiday deals or weather forecasts. The screen struggled to show many characters and the pages loaded so slowly - but Teletext was the forerunner for so much that we now take for granted on the Web. Now, Teletext has simply been overtaken by technology - a great example to use when explaining how the decline phase in a product life cycle can be accelerated by technological change.
Teletext still has many users, but has been loss-making for several years. The owners of Teletext cannot see a way to return the service to profitability - so it is to be closed down a couple of years earlier than expected.
A couple of interesting comments from the MD of Teletext in the papers today:
“As anticipated, the continued fragmentation of television audiences and the growth in the use of the internet has resulted in a significant reduction in the audience and the volume of commercial activity generated by the television services.” - in other words, the market has changed beyond recognition.
“Usage may be half its peak but we still have 11 to 12 million viewers a week, and most internet businesses say you could make plenty of money with that. But we can’t get the economics right” - i.e. the fixed costs of operating the service are too high and the revenues per user too low. Not unusual for many analogue media businesses currently.
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