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SCREEN AFRICA EXCLUSIVE:
By Frank Poppelsdorf, vice president, Product Management, Irdeto.
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As consumer behaviour continues to evolve rapidly due to technological advances in the pay TV space and the rapid growth of OTT, the market in Sub-Saharan Africa presents opportunities and challenges for operators.
According to the Sub-Saharan Africa Pay TV Forecasts report, released by Digital TV Research earlier this year, the number of pay TV subscribers is predicted to see an increase of 74 per cent by 2023, to 40.89 million. While this growing subscriber base is a clear opportunity for operators, retaining existing customers and attracting new subscribers is not without its challenges. In fact, the same report predicts pay TV revenues in Sub-Saharan Africa will increase by a much slower rate of only 41 per cent by 2023.
This could be down to increased competition driving down prices, as well as the increasing global penetration of pure play OTT providers (Netflix launched in an additional 130 countries, including South Africa, in January 2016). It has led consumers to expect OTT functionality and content everywhere but at a lower price-point. Whatever the market factors involved, as pay TV operators look to capitalise on the OTT opportunity while simultaneously sustaining strong traditional pay TV operations, they need to come up with ways of rolling out exciting new services and content while ensuring on-going cost efficiencies.
TRADITIONAL PAY TV REMAINS ESSENTIAL
While global OTT growth has been impressive, traditional pay TV services are still hugely important in the region. Operators must therefore consider the evolving consumer requirements for speed and convenience, however content is delivered. They must look to capitalise on new methods of secure delivery of their broadcast content, to serve consumer convenience and make the sign-on process easier and cheaper.
The issue faced by operators, is that launching pay TV services in a highly priced competitive market is challenging and they must balance the need for protecting their content against tremendous cost pressures. Rather than being a cost burden, high quality security should be an enabler for business growth by evolving to support an operator's changing needs. A software-based security solution will allow operators to securely deliver content across devices, while providing a cost-effective and easily renewable solution to stay ahead of piracy and security threats without hardware dependencies.
As operators look to further develop and grow their businesses, they must also be able to create new revenue streams from different tiers of programmes or services, which will require the management of subscriber entitlements. Conditional Access (CA) will ensure that different packages can reach subscribers from different income groups and it will also help operators address piracy concerns. In addition, CA is also important for Digital Terrestrial Television (DTT) migration and ensuring official set-top boxes (STBs) are securely delivering content. This will also enable pay TV services to be added if required.
CONTENT DELIVERY STRATEGIES FOR THE FUTURE
Whether looking from a global or regional viewpoint, there is no denying that increasing choice is changing consumer habits and demands. This has led to an increasingly competitive entertainment landscape where traditional satellite and pay TV operators face a big challenge to hold onto subscribers and market share. When you throw in the entry of the internet giants into the content market, operators must continue to look at how their businesses can evolve to make the most of on-going market opportunities.
To remain competitive as the market continues to evolve in future, operators will need to be looking to offer a hybrid STB with linear TV and OTT services. Open platforms like Android TV can be the most effective and fastest way to future-proof a set-top box and explore new revenue-generating services. However, the operators won't be able to make this future move without first ensuring a secure digital TV ecosystem, where subscriber entitlements can be managed, with the security demands of premium content met. The key to this is a 360-degree approach to security which complements Conditional Access. This means a combination of state-of-the-art security technology, proactive services delivered by experienced investigators and analysts, and comprehensive cybercrime business intelligence services. This will enable operators to securely deliver high value content, enable new revenue streams and secure future growth.
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