Over-the-Top Video Surge Continues to Drive New Digital Entertainment Market

12 August 2015

A growing chorus of analysts has come to the conclusion that the ability to deliver services to consumers via the Internet gives over-the-top (OTT) providers an edge over broadcasters and others who are grappling with how to keep up and deliver the most compelling new experiences to consumers in a timely and cost-effective manner.  That’s one key reason broadcasters like CBS launched its All Access OTT service last fall and launched its $10.99 Showtime OTT service in July.

Bottom line: although OTT providers must grapple with the complexity of delivering a compelling content experience to consumers on a wide variety of devices, they also are in the pole position to bring new imaging capabilities to market faster than their competitors.

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A growing chorus of analysts has come to the conclusion that the ability to deliver services to consumers via the Internet gives over-the-top (OTT) providers an edge over broadcasters and others who are grappling with how to keep up and deliver the most compelling new experiences to consumers in a timely and cost-effective manner.  That’s one key reason broadcasters like CBS launched its All Access OTT service last fall and launched its $10.99 Showtime OTT service in July.

Bottom line: although OTT providers must grapple with the complexity of delivering a compelling content experience to consumers on a wide variety of devices, they also are in the pole position to bring new imaging capabilities to market faster than their competitors.

As they continually seek to upgrade the consumer viewing experience, OTT service providers also can drive innovation with leading-edge technologies like higher dynamic range (HDR) and wider color gamuts (WCG).  But OTT providers don’t have the luxury of resting on their laurels — particularly as the competition heats up to satisfy consumers’ desire for services that combine both VOD and live-linear content.

Content, Multiple Platforms Are Key Consumer Requirements

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Parks Associates

OTT video services have surged so far this year, with more than 65 players either offering video services today or announcing plans to do so in the coming months, according to a new study conducted by Parks Associates.

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Approximately 1.6 billion people worldwide actively watch online video on a variety of connected devices — representing just over 20 percent of the planet’s population, according to the report, which was co-sponsored by Vindicia and Ooyala.  An estimated 900 million people access TV programming and movies online today — and that number will swell to over 1.3 billion video viewers by 2019.

Not surprisingly, these viewers have very high expectations for their OTT services — and their first priority is content. The report found that more than 70 percent of consumers subscribe to services like Netflix and Hulu Plus due to specific titles available through the service, and over one-third of consumers do so in order to access original content.

Service availability is another critical consideration, and consumers also expect an OTT service to be available on multiple platforms. Almost half of consumers who watch video on connected devices want to be able to use four or more different connected platforms to access OTT video content, according to the report.

Those insights help explain the flurry of new streaming services this year.  Following in the footsteps of the HBO Now streaming service, Showtime is offering a stand-alone streaming service with Apple as its first partner. For a monthly price of $10.99 — $4 less than HBO Now — users of Apple devices including iPhone, iPad, iPod touch and Apple TV are able to subscribe to Showtime as a stand-alone service.

Unisphere Research

Unisphere Research

OTT video delivery is making a marked impact on both the broadcast and streaming industries, driving consumer and technologies shifts in media consumption, according to a new survey from Unisphere Research.  The report, which was sponsored by Level 3 Communications and crafted by Transitions Inc., analyzes responses from 809 Streaming Media Magazine and streamingmedia.com readers on OTT trends and opportunities.

The survey found that nearly three-fourths of respondents see OTT as a viable revenue opportunity today. Even for those survey takers who indicated they’ve not yet moved to offer OTT services, there was a strong understanding that it’s no longer just a video-on-demand (VOD) play.

Respondents also said that offering both VOD and live-linear channels will be critical for OTT providers to entice new prospects and gain market share.  For existing OTT providers, however, offering a VOD service may not be enough to maintain, much less grow, market share.

Sources:

http://www.businesswire.com/news/home/20150608005459/en/Vindicia-Ooyala-Study-Parks-Associates-Finds-OTT#.VXhuN9JViko

http://www.prweb.com/releases/2015/05/prweb12740799.htm

https://www.cbspressexpress.com/showtime/releases/view?id=42817

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