OTT growth, collaboration and a new era of pay TV delivery
01/11/2017
OTT growth, collaboration and a new era of pay TV delivery --
Wed, 01 Nov 2017 11:03
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Written by Steeve Huin, vice president of Strategic Partnerships, Irdeto
A media landscape where consumers can watch movies, TV programmes and sports at any time, through any device they want, is the new reality around the world. Global OTT revenues have been estimated by some to reach $65 billion by 2021. As mentioned in my previous article for Screen Africa on 360 security, a report from Digital TV Research has predicted that OTT revenues in sub-Saharan Africa alone will reach US$640 million by 2022.
For operators, getting OTT services and content to as many screens as possible and as quickly as possible is the key to winning customers. But they face challenges in ensuring that consumers can receive premium content securely, and with the best possible user experience.
Meanwhile, pure OTT services like Netflix, which launched in South Africa in January 2016 as part of a global expansion which saw it launch in 130 countries around the world, have taken advantage of this consumer demand for OTT content. However, the market dynamic between pay TV service providers and OTT service providers
unyielding adversaries only a couple of years ago is evolving.
Collaboration, content and control
Many operators today are looking for ways to collaborate with services like Netflix or even non-traditional TV platforms. It s clear by now that we are not living in an
either/or scenario. Collaboration, or at least strategic co-existence is often a
practical and efficient way to enhance the overall user experience, which is a key differentiate in today s competitive market.
With so much content on offer globally, it has become difficult for one operator alone to satisfy all the content demands of consumers, which is perhaps signalled by an estimated leveling of global pay TV revenues and even subscriber decline in some markets. The Global Pay TV Revenue Forecasts
report from Digital TV Research estimates that global pay TV revenues will peak at just over $202 billion this year, but decline slightly to just under $200 billion by 2022. However, the same report estimates that pay TV revenues Sub-Saharan Africa will surge by 57% (up by $2.40 billion to $6.59 billion) between 2016 and 2022.
Whether looking at a global or regional viewpoint, there is no denying that increasing choice is changing consumer habits and demands. To meet these evolving needs, the winning approach for operators is to offer a hybrid set-top box (STB) with linear TV and OTT services be it their own or from partners such as Netflix. This way the operator controls the HDMI 1 and gets consumers to come to their platform for all their content needs.
New content delivery platforms
Set-top box platforms have evolved over the past few years from closed environments using proprietary middleware to increasingly open environments, such as Linux, RDK and Android. While open environments cause some concerns among operators
regarding control and security, they create many business benefits that outweigh these concerns.
On the far end of the open spectrum is Android TV, an excellent option for
operators who want to launch a hybrid set top box quickly, with low development and operational costs. By leveraging built-in features of Android TV, operators can add their broadcast service in six to nine months, or shorter if they leverage a pre-
integrated solution from a security partner. Besides the cost and time advantages, they give consumers instant access to thousands of OTT and other apps in the Google Play Store. Android TV allows operators to future proof the STB and expand business opportunities beyond media. Securing this open platform requires careful planning, but it is well worth the work for the benefits Android TV offers.
Effort-free sign-on to reach new subscribers
However, what if the consumer is on the fence about your broadcast service? How can you make the sign-on process easier and cheaper?
One is to embed CA directly into TVs, as Irdeto has recently done in partnership with home and professional appliance manufacturer, Vestel. With pre-integrated pay TV security capabilities within a TV, consumers can now have the best of both worlds instant access to their favourite pay TV service, on the big screen without extra
equipment. For operators this has the potential to make subscriber acquisition easier, by providing consumers with friction less instant-access pay TV services on a new TV that they purchase.
It s clear that broadcast services will remain extremely important in the pay TV
market in sub-Saharan Africa for the foreseeable future, but demand is increasing for OTT content across unmanaged devices as well. As they look a collaboration or just co-existence with OTT players, operators must ensure they have an effective hybrid strategy to delivering premium content to their customers securely, whether through the STB, unmanaged devices or direct through the TV.
Irdeto will be exhibiting and discussing it s TV Cloaked CA partnership with Vestel at TV Connect Africa at the Cape Town International Convention Centre from 7 to 9 November 2017.
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