Understanding the impact of the IP revolution

Key lessons from broadcasters and their technology providers

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Many working in broadcast will have heard that we are moving towards an “age of IP”, but industry executives are still coming to terms with the far-reaching implications of that shift.

At its core, Internet Protocol (IP) technology describes the use of the technology that underpins the internet to move, process and deliver content to audiences, allowing broadcasters to process content more quickly and efficiently, and deliver it to audiences in a more diverse range of environments. It has also lowered the barriers to entry for new entrants, opening the door to new IP-only content engines like Netflix and YouTube.

As a result of this IP revolution, broadcasters must consider what value IP can unlock within their existing business as well as what it means for the structure of the media industry.

Our latest Technology Pathfinders event, held earlier this week, examined how IP technology is redefining the broadcast industry supply chain, and what it means for content production, distribution and audiences. We were joined by four expert panellists, well placed to discuss the challenges and emerging opportunities:

  • Andy Munro, Senior Product Manager, Arqiva
  • Mark Harrison, Managing Director, Digital Production Partnership
  • Martin Richards, Principal Design Lead, Sky
  • Simon Dore, Chief Operating Officer, GoMedia

The discussion was moderated by Nick Thomas and John Cobban from MTM.

What started as a discussion about the benefits that IP technology is delivering today quickly shifted to a debate about what the future holds. As more elements of production and distribution start to take place on IP networks, the panellists and audience agreed that broadcasters will have to fundamentally re-think their existing business models, and even what it means to be a broadcaster.

We’re only just starting to see the benefits of IP across the value chain

While members of the panel are already seeing IP deployments deliver tangible cost savings within their business, they all agreed we are still some distance away from realising IP’s full potential. Today is it largely used as an enabler for existing processes, and we will only see the full impact once broadcasters start to re-evaluate their core business models in light of the flexibility and rich data environment that IP offers.

We’re still seeing IP as an enabling function. The infrastructure is changing but the processes are the same. The next stage is about using IP to do completely new things. I’m very excited about what AI and machine learning could mean in the broadcast environment.

Audiences want more – and IP infrastructure can provide it

While technologists and consultants can get excited about what the latest IP advances mean for business processes, the panel agreed that advances have to be measured on what they deliver for audiences looking for greater choice and quality. IP technology is being adopted because it allows broadcasters to lower the cost of producing and delivering high quality content to increasingly demanding audiences.

If we can lower the cost of producing content, we can make more of it and we can make it better with the same resources. We can offer more camera angles, more interactivity, higher resolutions.

IP is redefining the role of a broadcaster

The panel highlighted the uncertainty about what IP means in the longer term. Some in the room went as far as the question the need for broadcasters to have their own infrastructure, when it is possible to leverage existing IP networks for much of the post-production and delivery processes, but others felt that this was too great a step-change to occur in the near future.

Nevertheless, the whole room was in agreement that that we haven’t yet seen the full impact of IP technology. Everyone is keeping their eyes out for what the future holds – and how broadcasters will adapt to the growing competition for audience attention in an all-IP environment.

I see a future where we have very little hardware, it’ll all be in the cloud and new deployments will be brought to market much more quickly. The barriers are lower than ever before so the competition for attention will only continue intensify. As always, the audience will drive the agenda. Anyone operating in that environment will need to innovate to meet that demand, or they’ll find themselves in deep trouble.

Event organiser

As the trusted media partner to the world’s leading broadcasters and content owners, Babcock provides the complete range of fully-managed solutions to deliver channels and content to global audiences across any platform. Our dedicated team of experts work closely with customers and industry specialists to tailor solutions for maximum efficiency. To learn more visit www.babcockinternational.com

 

 

Arqiva is a leading UK communications infrastructure company enabling a vibrant digital economy. We are behind the scenes and central to millions of vital connections. We are pioneers in an always on, always connected world. To learn more, visit https://www.arqiva.com/ 

Making everything happen – managing multi-platform OTT and VOD

Key lessons from broadcasters and their technology providers

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Many thanks to everyone who attended MTM’s latest Technology Pathfinders Executive Forum on Tuesday 11th July, exploring the challenges of managing multiplatform over-the-top (OTT) video-on-demand (VOD) services.

Almost 90% of all European broadcasters offer one or more OTT service. iPlayer, All 4, Netflix, Amazon Prime and many others have helped change the way television is consumed, allowing audiences greater freedom to view content at a time that suits them, and on whichever device they choose.

As consumers increasingly experience media outside of the living room, the pressure is on OTT services to adapt and fit a multitude of screens. Providing a best-in-class, multiplatform product is becoming increasingly difficult and competitive.

To discuss this diverse and dynamic landscape, we were joined on the panel by:

  • Adam GilmanDirector of Technology, Turner EMEA
  • Chris AlnerBusiness Development Director, Satellite and Media, Arqiva
  • Dean HaddockDirector of Broadcast Services, Babcock
  • Tom Gibb, Digital Product Director, NBCU’s hayu

The event was moderated by Jon Watts and John Cobban, Managing Partner and Consultant at MTM respectively.

Challenges going over-the-top

The conversation began by exploring the difficulties and challenges of providing a seamless multiplatform experience. Any online video platform (OVP) involves a combination of back-end processes and front-end design, but offering multiplatform functionality at scale presents some big challenges. Billing, both in-app and on connected TVs, was raised as one key issue, as was creating an efficient video workflow. Capturing and understanding the right data was another problem flagged by our panellists, and the complexities of Digital Rights Management (DRM) led many to roll their eyes.

International markets can also have structural issues that present problems you might not expect. Those with ambitions abroad often pointed to language support and subtitling challenges, and one panellist in particular pointed out the problem of simultaneous scheduling in the context of Japanese football.

“A lot more integration needs to happen… for example, Japanese football all kicks off at the same time. That’s 15-20 matches. If something goes wrong it can be chaos for us… While the users don’t always see it, internally it can be very hard.”

Though it’s a sign of success, noted a panellist, that the end consumer is unaware of many problems underlying multiplatform OTT solution. Retaining this consumer facing seamlessness was agreed by our panel to be of upmost importance.

Understanding the acronyms

Although OTT VOD services present certain levels of challenge and complexity, the panel were optimistic over their future. One panellist noted problems associated with scaling up are not critically difficult problems for businesses to deal with. Another noted that solutions are starting to offer data and insight that can support increasingly advanced analytics to improve performance.

“In terms of a recent change…we have done a huge project on data. We realised we didn’t have video performance metrics; we didn’t know what users were doing when they were in our service. Now, every month we are adding 5 million data events and are mapping these back to our accounts. Our aim is to see when consumers change their behaviour so we can get to them before they churn.”

Painting a supplier landscape

The conversation then moved onto the supplier landscape and navigating through the various vendors who all claim to provide “end-to-end” solutions. One panellist noted that building partner relationships and deepening connections with vendors and suppliers is central to developing a sophisticated product, but you have to look very carefully at what you’re buying.

“When technology suppliers say they do everything in one box… I will look very careful at everything in that box as something’s bound to be off. You’ve got to know what you are buying and utilise it as effectively as possible. You should know where to draw the line. Keep the boxes separate.”

Scale, scale, scale

The conversation drew to a close with some excitement about scaling up over the next 3-5 years. Device proliferation combined with new territories ripe for exploration created an optimistic air. The panel agreed, however, that testing mechanisms would have to improve, and automation would have to play a bigger role to successfully deliver solutions at scale. The panel noted that having a solid infrastructure would be crucial in order to keep growing users or subscribers, and services have to be aware that is it more difficult to scale-up in new territories than it is to grow within existing ones.

“In terms of managing video and data workflow the scaling doesn’t scare us. We should be built for scale. It’s coping with that as part of its DNA, but growth into a new territory is not just as simple as monitoring user experience, it’s building the support base beneath.”

Next generation solutions

Overall, the discussion identified some significant challenges to successfully operating and scaling a successful OTT service, but our panel demonstrated that we’ve learned a lot in the last 3-5 years about where the challenges lie and how they can be overcome. We’re looking forward to sitting down to enjoy the next generation of OTT solutions on whatever platform we choose…

Event organiser

As the trusted media partner to the world’s leading broadcasters and content owners, Babcock provides the complete range of fully-managed solutions to deliver channels and content to global audiences across any platform. Our dedicated team of experts work closely with customers and industry specialists to tailor solutions for maximum efficiency. To learn more visit www.babcockinternational.com

 

 

Arqiva is a leading UK communications infrastructure company enabling a vibrant digital economy. We are behind the scenes and central to millions of vital connections. We are pioneers in an always on, always connected world. To learn more, visit https://www.arqiva.com/ 

Keeping pirates out of the living room: The future of content protection

Key lessons from broadcasters and their technology providers

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On Tuesday 16th May, 60 senior media executives from across the industry attended our latest Technology Pathfinders event.  The discussion looked at the future of content protection and piracy, assisted by five expert panellists from across the media industry, representing the US studios, major sports rights owners, broadcasters and content distributors:

  • Trevor Albery, VP Content protection and analytics, Warner Bros.
  • Marianne Grant, Representing the MPAA and the “Get it right” campaign
  • Mark Lichtenhein, Chairman, The Sports Rights Owners Coalition
  • Rob Pinniger, Associate Director, Content security and anti-piracy, Virgin Media and Liberty Global
  • Stephen Stewart, VP Global content operations, BBC Worldwide

The discussion was moderated by Nick Thomas and Karin Bergvall, Associate Director and Senior Consultant at MTM.

The discussion highlighted some of the industry’s recent achievements, including the crackdown on Kodi boxes from Amazon and the real-time blocking of pirate livestreams by ISPs. The room was confident that through the use of new technologies and industry collaboration, it will become increasingly difficult for pirates to profit from the distribution of illegal content. Looking into the future, however, the game of cat and mouse between those protecting their content and those who distribute it illegally for profit looks set to continue.

Here are 5 of the most interesting takeaways from the event

The industry is uniting to take on the pirates

The panel agreed that presenting a unified front is necessary to successfully respond to issues – such as the Kodi box – as they develop. Only with full cooperation across the value chain can content be secured until delivery, and only with the support of broad membership can industry groups lobby for change.

There’s starting to be a consensus that it’s not just companies working together, it’s groups of companies or membership organisations working together. We’re not going to have any serious effects if we’re all just ploughing our individual fields.”

Pirates threaten more than just the video contentDespite the focus on streaming and illegal downloads, piracy can take other forms. Leaks of storylines, casting and characters can be just as damaging to a franchise as an episode leak – distributors have a responsibility to content owners to protect the identity of the new Doctor Who or the design of the new Batmobile as well as the content itself.

“There is a range of different types of piracy – it’s not just about the release of finished shows or movies. We can’t let our storylines, characters or plot twists leak and spoil the release for true fans who waited to enjoy the content legally … protecting the magic of the big reveal can almost be more important – and more challenging to do well.”

Live piracy poses new problems – and needs a faster responseThe panel agreed live-event piracy is different to scripted film and TV, as much of the value lies in the live experience. Shutting down a pirate IP within two hours might be viewed as a success for a major studio, but would be too late for a 90-minute football match. ISPs have recently been granted a court order enabling them to easier live-block websites streaming Premier League matches – this is seen as a major step forward for protecting sports rights owners. However, with an estimated 16.7m people globally having watched live video streams of the recent Klitschko-Joshua fight illegally across Twitter, YouTube or Facebook it’s clear that more still needs to be done to ensure that such content is difficult to access.

“The value of sport is all in the live experience and it’s easier for pirates to extract all that value very quickly. We have to keep on top of them.”

Piracy is a proxy for consumer demand

On a more positive note, the panel were comforted that piracy implies consumer demand for their content. In markets with limited content legally available, monitoring pirate activity with data analytics can identify untapped demand. Piracy can unearth audiences for particular shows or channels, highlighting opportunities for content providers to migrate audiences to their legal version.  The challenge for content owners is to balance windowing and distribution to ensure that money flows to the content owners, not the pirates.

“The silver lining of piracy is that it shows that there is huge demand for our content – and we should be migrating that to legal channels”

Pirates are not over the horizon yet

The piracy landscape is constantly evolving, and thus panellists were reluctant to commit to specific predictions about the future. While the industry has managed to make piracy increasingly difficult, new technology constantly threatens this progress. The industry must remain vigilant and pro-active in its efforts to address new piracy approaches, whatever forms they take.

“Five years isn’t a long time in the history of piracy. The only prediction I’m willing to make about piracy is that we’ll still be talking about it five years from now”
Event organiser

As the trusted media partner to the world’s leading broadcasters and content owners, Babcock provides the complete range of fully-managed solutions to deliver channels and content to global audiences across any platform. Our dedicated team of experts work closely with customers and industry specialists to tailor solutions for maximum efficiency. To learn more visit www.babcockinternational.com

The future of video search, recommendation and personalisation solutions

Key lessons from broadcasters and their technology providers

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Summary

On the 1st March 2017, executives attended the first Technology Pathfinders forum of 2017 to discuss the developments of Search & Recommendation Personalisation (SRP), assisted by five expert panellists:

  1. Sarah Milton, All4 Head of Product, Channel 4
  2. Phil Sellick, Lead Architect/Technologist, Advanced Video, Innovations and Trials, Liberty Global
  3. Josh Wiggins, Chief Commercial Officer, GrayMeta
  4. Greg Valiquette, VP Europe, at Accedo
  5. Andrew Scott, Launch Director myBBC, BBC

The discussion was moderated by Karin Bergvall and Jon Watts, Senior Consultant and Managing Partner at MTM. The evening provided a clearer picture of the position and future of SRP solutions.

Effective SRP solutions are vital for broadcasters and video platforms

Search, recommendation, and personalisation are distinct concepts; altering the way we consume online content. The effectiveness of SRP solutions can be measured by various consumption metrics; from efficiency measures – how many searches are needed before viewers find what they want? – to engagement measures – how long did the viewer watch the second episode? Most important to the panellists in creating effective SRP solutions is breadth of consumption catalogue:

 “To my mind, in this world of immense choice, a great depth and breadth of content is essential to deliver a relevant and inspiring experience”

The complexity of viewer categorisation

Panellists stressed the importance of changing consumer behaviour across all ages, not just the youth. Therefore, rather than basing viewer categorisation on demographics, the categories of selection should be type of content, platform, time of viewing, or viewer tastes and behaviours. These points sparked interesting questions such as: do we need different SRP solutions across different platforms, devices or viewer categories?

“Everyone’s behaviour is changing, not just the youth. We are growing up and consuming content differently.”

Content is king, but metadata builds empires

Data on consumer behaviour provides a deeper understanding of consumption needs. Collected together, this data intelligence and metadata can increase the quality of SRP solutions by improving framing and accuracy, delivering a more customised experience. The suggested use of contextual information to collect this kind of data opened up interesting discussions on some ethical considerations, for example how far can data collection go before it becomes too invasive?

“We are making use of a wealth of solid data and data science capability to develop personalised and targeted customised experiences”

There is still a key place for human curation

The panel agreed data and algorithms in SRP solutions is relevant and important. Yet, human curation in these solutions remains critical as algorithms were noted to create “bland channels” of “echo chambers” by surfacing similar content. Our panel agreed that humans will retain an important place within SRP, especially through editorial capacity. Overall, a combination of algorithmic and human curation in SRP solutions is crucial, with example solutions including the ability to curate the first few number of items generated by an algorithm, or a personalised, dynamic, live online schedule:

 “Our approach is to combine the two – a balance between editorial and science of data. We are looking at ways the taste of our audience can flex and bend beyond the obvious”

In the future, voice recognition will address semantics of TV search

The panel then discussed voice recognition in SRP solutions. Advancements in voice technology could develop SRP solutions from title-related searches to semantic-related searches. For example, searching for ‘the movie with the man in the green hat’ and being offered a range of solutions, all containing men in green hats. Our panel were excited by the capacity for SRP solution to develop a more sophisticated approach to responding to viewer needs and that soon voice recognition, and its semantic interpretation, will be the remote control of choice:

 “The point is that fundamentally human needs will not have changed in 10 years’ time. The mechanisms by which we satisfy those needs will have changed. I see speech as the thing that will advance this”

Event organisers

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As the trusted media partner to the world’s leading broadcasters and content owners, Babcock provides the complete range of fully-managed solutions to deliver channels and content to global audiences across any platform. Our dedicated team of experts work closely with customers and industry specialists to tailor solutions for maximum efficiency. To learn more visit www.babcockinternational.com

GrayMeta Platform is a powerful framework to help you tackle big data and metadata problems to save time and money. It builds context and searchability from all your assets. To learn more visit https://www.graymeta.com/

For well over a decade, we’ve enabled premier broadcasters, media companies and TV operators to bring next generation user experiences to their audiences. Our services cover the full circle, from integration on multiple platforms through to all connected devices. Globally. To learn more visit http://www.accedo.tv/

Hot or Not: Top broadcast industry technology trends for 2017

Key lessons from broadcasters and their technology providers

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Summary

On 1st December 2016, MTM hosted the third Technology Pathfinders forum, a professional network for senior broadcasting and media industry executives interested in the latest technology developments and innovations. The theme for the evening was Hot or Not? What are the technology trends that will impact the UK TV market over the next five years.

To help guide us past the peak of inflated expectations and through the trough of disillusionment we had an expert panel comprising Jon Williams, MD & CEO of Pixsan, Nic Brisbourne, Managing Partner at Forward Partners, Orpheus Warr, CTO at Channel 4, Phil Aspden, Business Development Director at Babcock and Richard Lindsay-Davis, CEO of the Digital TV Group.

Rise of the machines: Data, analytics and AI

As TV consumption moves to connected devices, broadcasters and TV providers are acquiring ever-increasing quantities of data and insight. Our panel were unanimous in their belief that big data will help unlock the answers to consumer engagement, creating frameworks for monitoring and flagging specific user behaviours, and re-shaping the way we find content.

However, the panel disagreed on the importance of AI and deep learning. While two panellists claimed that AI will have marginal impact on the TV industry, one panellist was adamant that deep learning and artificial intelligence will play a crucial role going forwards, drawing out insights and correlations that would not be feasible with traditional analytics tools.

“As broadcast is being reversed into by IT, IT is being changed by deep learning. It will drive the pace of change and be a fundamental enabler of better TV – through voice recognition, recommendations, intelligent security, data mining, improved quality of service.”

The new (virtual) reality TV

The next theme of the evening was new forms of content creation opened up by new platforms, such as social networks or Virtual Reality (VR) headsets. The panel agreed that social media platforms will have a larger impact the TV industry more than VR. As the barriers to entry in the social video space are basically zero, there has been a proliferation of new content creators, driving new user behaviours. On the other hand, only half the panel expected VR to be an impactful technology for TV over the next five years, instead expecting take-up to be driven by gaming.

“Big platform changes is what enables big new businesses to come – in news, social media has turned it on its head, changed the way that we create and consume news… I’m not sure [VR], on the other hand, will have a big impact on overall TV viewing”

Boxes, pucks, and sticks

Finally, the panel discussed hardware trends. While 4K and Ultra HD were largely perceived to not provide enough viewing difference to the average consumer, one panellist was excited about the prospects for HD HDR technology, offering better colour, contrast and brightness at a relatively low cost.

Our panellists then moved on to discuss the integration between TV devices as part of the Internet of Things (IoT). As low-cost dongles help drive connected TV penetration, such as the Amazon FireTV stick and Chromecast, the panel agreed that the next step is connecting TVs to smart speakers and home hubs, such as Amazon Echo or Google Home. Going forward, two panellists claimed that the proliferation of sensors and ability to gather new forms of geographic and behavioural data will be strong drivers of future TV developments.

“Low-cost devices are changing the way that people are consuming TV – you can turn your TV into a smart TV for £30, enabling you to move to IP delivery … The TV is increasingly connected to the overall IoT ecosystem. As Amazon and Google are battling it out, I think that we are going to see a lot of change in the next few years.”

Event organiser

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As the trusted media partner to the world’s leading broadcasters and content owners, Babcock provides the complete range of fully-managed solutions to deliver channels and content to global audiences across any platform. Our dedicated team of experts work closely with customers and industry specialists to tailor solutions for maximum efficiency. To learn more visit www.babcockinternational.com

Building and managing subscription OTT products

Key lessons from broadcasters and their technology providers

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Summary

Premium Over-the-Top (OTT) offerings – subscription film and TV services delivered over the internet to connected devices – are proliferating, as TV businesses, tech firms, rights holders and other industry participants look to capitalise on growing consumer demand for low-cost, all-you-can eat premium video services. The market is widely expected to grow, but developing, launching and operating a direct-to-consumer OTT service can be challenging. Many industry participants believe the underlying solutions are still immature, requiring complex build programmes and multiple vendors, and managing subscriber relationships remains difficult.

Technology Pathfinders is a new networking group for broadcast executives interested in exploring innovations and future trends in operations and technology. On the 1st November, we brought together key industry players for a closer examination of subscription OTT in the UK, facilitating a discussion about what we’ve learned so far and how online video is likely to evolve over the next five years.

The panel for the event included: Phebe Hunnicutt, Vice President of Branded on Demand (SVOD) at NBCUniversal Media; Richard Young, SVP Content and Business Development at Magine TV; Kerensa Samanidis, Head of Digital Products at the BFI; Dean Haddock, Director of Broadcast Services at Babcock, and Rags Gupta, General Manager, EMEA at Ooyala.

During the panel discussion, several key questions were explored, including:

  1. How do you convince users to pay for your service?
  2. What are the main technical and operational challenges to moving online?
  3. How many people does it take to operate and maintain an SVOD service?
  4. How hard is it to integrate broadcast and OTT workflows?

Please read on for a roundup of the most interesting opinions and discussion points. The event was held under the Chatham House Rule, which means we cannot directly attribute quotes to speakers or attendees. Technology Pathfinders would like to acknowledge and thank the sponsors of the event, Babcock and Ooyala, for their support.

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Setting the scene – What’s the current state of the premium OTT market?

The discussion highlighted the polarisation that has taken place in the market; as subscription OTT continues to mature in the UK, the market has split into major services (e.g. Netflix and Amazon Prime) that compete based on popular content, and niche services (e.g. BFI Player and Showtime) that capture small but dedicated audiences.

“There’s a bit of a land grab going on at the moment.”

Competition is heating up across the market, and the major services continue to invest in attempts to differentiate themselves in genre and format. Netflix’s evolution towards premium TV drama was noted by the panel, as well Amazon Prime’s, focus on feature films. The panellists reflected that, in the past, major OTT services launched with significant investment, but without clear direction in terms of target audience and key requirements, and these big players are now attempting to better understand their audiences through consumer analytics and establish their position in the market. As one panellist put it, successful companies are clear about what they’re trying to do; the ones who aren’t risk losing a lot of money.”

1On the niche side of the market, the panellists agreed that increased competition is pushing smaller OTT services to add new content to their existing catalogues in an attempt to extend their reach beyond traditional core audiences. One panellists added that the vertical niche services are trying to appeal to interests outside of the focus of the big services, for example documentaries or other specific content. For these smaller players, OTT has the potential to generate significant revenue from older, less popular content, which consumers traditionally shunned through pay-per-view.

Smaller OTT services benefit from relatively fast service launches due to the lower complexity of their propositions – with fewer rights agreements and less demand from their dedicated audiences for multiplatform distribution or live content. Many niche providers capitalise on the ‘stickiness’ of their subscriber base by prioritising the OTT launch and then slowly evolving the offering over time, rather than having to begin with a market-winner. One panellist emphasised this point: when [OTT service] launched, [they] didn’t know what launching meant or what the package would be. In fact, it took [them] two years to figure out what the offering was.”

All the panellists agreed that, underlying the OTT market, there is one particular pain point that especially applies to major service providers: the high price of failure. With the success of OTT offerings being driven by social media and hype, users are currently in the driving seat and have low tolerance for issues of poor quality or stagnant catalogues.

Questions to panel

1. How do you convince users to pay for your service?

The panel discussion reflected on past mistakes made by major OTT providers who did not put the consumer at the centre of their propositions. With large investments being made in OTT, the ability to identify key consumer requirements and highlight them in the proposition is crucial to acquire and retain subscribers. One example of a clear value proposition is NBCU’s hayu OTT service, which delivers programming within hours of the US releases times – a key interest identified for their consumers.

“If you have no competitive advantage, you’re in no-man’s land.”4

The panellists agreed that focusing on content and communicating a clear proposition through a strong marketing campaign were the most important ingredients for success in OTT. However, it was recognised that, in most cases, niche services require far less investment in marketing to attract a core audience. One panellist commented that effective marketing campaigns “emphasise the breadth of the catalogue as a key acquisition strategy”. Social media integration was also noted as an invaluable component of any marketing campaign, with some OTT services generating branded clips from popular TV shows that users can post and share online.

The panellists felt that a critical element for customer acquisition was lowering the barriers for sign-up and churn. Today’s OTT consumers want a service to be easy to sign up to and easy to leave, and with industry leaders like Netflix holding to the no frills mantra, creating an OTT service that provides this simplicity has become a key factor in customer acquisition.

2. What are the main technical and operational challenges to moving online?

The panel reflected that OTT services can take many forms, each with varying levels of complexity and required investment. While “me-too” OTT services consisting of VOD-only libraries and no live content can be relatively low-effort, low-investment (under six figures) to launch, more sophisticated solutions with robust integration between an online platform and broadcaster can be much more complicated and costly. Overall, the panellists agreed that there is no one-size-fits-all solution to OTT.

“You have to get it right the first time and get the users on your side straight away.”

The panellists discussed that, in recent years, OTT players have tended to underestimate the costs and challenges faced in acquiring and retaining customers. One key challenge is the ability to create a successful OTT proposition that maintains its functionality as subscriber numbers and requirements change and the service evolves. As one panellist put it, “[successful players] need an operation that is constantly AB testing and applying growth frameworks to continually evolve the proposition”.

3Each OTT solution, especially the more sophisticated ones, consist of many moving parts (e.g. metadata management, CDN ingestion, etc.), all of which must be aligned and fully-integrated. If this alignment isn’t seamless, consumers now have the ability to spread service complaints like wildfire, through social media and other online reviewing, and seriously affect the success of a proposition.

In response to these risks, some providers have opted for managed OTT platforms, with OTT solution providers such as Ooyala and Babcock offering end-to-end solutions to companies who want to take their content online. These OTT solution providers offer a range of services to manage integration and streamline work flows, and can help companies to manage the risk of an OTT proposition using predictive analytics and consumer tracking to help assess churn.

The panel emphasised that, whatever OTT model is chosen, building and evolving the service requires a 5 to 10-year investment. Furthermore, as the service expands across multiple technology platforms and territories, quality of service becomes increasingly difficult to ensure.

3. How many people does it take to operate and maintain an OTT service?

The resources required to power an OTT platform depends greatly on the size of the proposition. Built from scratch, a large platform can require upwards of 200 people across multiple territories, with about 10% of staff engaged in in-life product management and day-to-day monitoring. However, relatively simple OTT services with less live content and more VOD, such as Mubi, can be managed with minimal dedicated resources, with a dedicated team of only 5–10 people.6

“If you don’t have anyone around when the users are tweeting, things can spiral out of control.”

The panel discussed that, as OTT is far more scalable than traditional TV, even major services like Netflix don’t require operational staff in each country where they have a presence. However, an important point for new OTT providers when it comes to resourcing is to understand potential issues that require immediate resolution, such as bad publicity on social media. One panellist summarised this view: if you don’t have anyone around when the users are tweeting, things can spiral out of control.

4. How hard is to integrate broadcast and OTT workflows?

The panel also emphasised the importance of aligning expectations across an organisation, or between an organisation and an OTT solution provider, when building an OTT service. The decision between owning the OTT service or having a managed service is largely based on cost. The former option, where the OTT provider builds and maintains its own apps, programming code and integration, can become expensive. Matching all of the OTT service components and identifying gaps across the system to ensure that it works seamlessly is particularly costly, and often companies, even those launching major services, aren’t setup to handle the magnitude of the task. The panel reinforced the notion that there can be a lot of anger from consumers if an OTT provider fails to offer a high-quality viewing experience”.

Predictions for the future

The event closed by asking the panel to discuss predictions for how the UK OTT market will evolve over the next 3 to 5 years. There was a general consensus that the OTT market will continue to grow in the UK, surpassing industry forecasts to reach over £2bn in gross revenue by 2022. Furthermore, it was widely agreed that the Winner-Take-All situation will continue, with one or two major OTT services maintaining a dominant position in the market. One panellist commented that “only providers with real brands and differentiated content will survive”.

“It’s going to be a blood bath. A lot of people are going to make mistakes.”

The majority of event participants predicted Netflix’s content spend to exceed £6.5bn by 2022, increasing from £4bn in 2016, as the dominant player focuses on premium content to maintain a top position in the industry. One panellist commented on the general move of OTT players towards favouring their own content over third parties: inevitably services will look to have their own content to maximise profits, just as Netflix had a huge Hollywood catalogue and now favours original content.

5Participants agreed that, as major OTT services continue to grow, Pay-TV operators will innovate in the space, potentially leading consumers to switch from traditional TV packages to OTT-only packages. In this area of innovation, it was posited by some panellists that interoperability will be a key driver of consumer decisions. When even participants were asked, a majority believed that the UK weekly reach of subscription OTT services with 16-24s would exceed 85% by 2022, growing from 57% in 2016. This underscored the increasing demand for OTT services across multiple platforms, which Millennials may see as a crucial differentiator.

Niche services were predicted to remain viable by holding onto their core audiences and exploring new revenue streams, such as becoming add-ons to larger services. Significantly, it was concluded by all parties that churn in the niche OTT segment will likely increase as more players attempt to enter the market. One panellist commented that there will be a lot of failed OTT services [in the next 3 to 5 years], but there will always be room for niche players.

The participants felt that investment in OTT will increase in the coming years. However, since only the most successful services will be profitable, this will lead to a number of failed services and potentially consolidation across the market. The consensus was that major services need to differentiate to compete, focusing on a strong brand and high-quality, differentiated content to survive in an increasingly competitive market.

Event organisers

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