Home Analysis The mounting evidence that aggregation and bundling will survive in the streaming...

The mounting evidence that aggregation and bundling will survive in the streaming world

All 4 now includes third-party content from VICE
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There is an ongoing debate about the value of aggregation and bundling in the OTT world and whether the rise of direct-to-consumer apps means viewers will turn their backs on platforms and the discounts they once received for subscribing to a pre-defined channel selection, and instead source content one app at a time – opening, watching, leaving and repeating this exercise across dozens of small and large media brands. There is plenty of evidence pointing to consumers stacking more OTT services, sometimes in place of a traditional aggregator (usually the Pay TV operator) via cord-cutting. But there are also increasing signs that ‘extended curation’, aggregation and bundling could live on in the streaming universe.

Two UK broadcasters have already moved, in a modest way, into ‘extended curation’, in the sense that they have third-party content in their streaming services – something like the Netflix model on a small scale, and without the subscription. Viacom-owned Channel 5 signed a deal last September to include content from the free-to-air channel BLAZE, which is owned by A+E Networks UK, on its My5 player/streaming service. And last month Channel 4 added VICE box-sets, branded as a collection – the first time that All 4 has hosted a third-party. Channel 4 noted: “This marks the next stage of All 4’s evolution from being a catch-up service to becoming a destination in its own right.”

The model for a multichannel online bouquet, with channels from various different content owners, is long-established, with TVPlayer in the UK and Magine TV in Germany good examples. TVPlayer was built upon streamed free-to-air channels but quickly evolved into a hybrid offering with a classic bundle of subscription TV channels on a ‘Pay Lite’ model (low cost and monthly contract). Eurosport, MTV, Comedy Central, Gold, Nickelodeon, Discovery, National Geographic, Lifetime and SyFy are among the brands available for £5.99 a month.

There are numerous examples of Pay Lite or ‘virtual MVPDs’ offering multi-broadcaster bundles from existing Pay TV companies (under separate brands). NOW TV has proved the viability of that model in the UK and is taking it across Europe.

A Hulu-like model has also arrived with joint ownership of shared streaming platforms that contain the content from multiple broadcaster groups. In Germany, 7TV combines content from ProSiebenSat.1 Media and Discovery (the joint owners) and Axel Springer and SPORT1 (the first third-parties on the platform). Other content groups have been encouraged to join. 7TV and ProSiebenSat executives were at Videoscape Europe this week explaining the digital aggregation ambitions at this platform.

Other multi-broadcaster OTT services are either promised (as in the case of RTVE, Mediaset España and Atresmedia in Spain) or rumoured, like in the UK, where recent comments by the communications regulator Ofcom suggest it would look upon joint initiatives sympathetically. BBC, ITV and Channel 4 (and maybe NBCU) are reported to be in discussions about a combined streaming service.

Amazon has established a unique ‘challenger’ aggregation model for streaming. ‘Amazon Channels’ provides a choice of direct-to-consumer services that you can subscribe to via Amazon, and whose subscriptions are then managed via one Amazon account. The user interface on this service removes the concept of the siloed app or website and has more in common with a highly visual programme guide than an app store, so you can move seamlessly between the different services.

Delegates at Videoscape Europe saw more evidence of aggregation in the streaming environment, and this time in the direct-to-consumer side of the market. Ellation, best known for its Crunchyroll anime SVOD service (and operating as a subsidiary of Otter Media, which is now fully owned by AT&T) revealed how it has created a multi-SVOD service under the VRV brand that contains seven previously independent streaming services from third-parties and several of its own.

Moreover, Ellation has introduced the classic concept of bundled discounting, much-loved in the ‘traditional’ Pay TV universe. The full bouquet is $10, providing a hefty reduction on what you would pay if stacking each service separately. The caveat is that the services inside VRV are a slightly lighter version – so super-fans will still find a reason to pay full-price for any of the streaming brands on an ‘a la carte’ basis.

The recent bundling of Sky’s box-sets and Netflix in a common package for Sky’s traditional Pay TV subscribers adds to this narrative. ‘Ultimate On Demand’ is offered with the expectation that a sizeable group of customers will welcome SVOD and Pay TV being in the same user interface and also having a combined price.

None of these developments, even taken together, prove that consumers will prefer their content and services aggregated in the streaming environment. But they suggest we should treat with great caution any claims that the future of TV is a completely de-aggregated, individualised, ‘a la carte’ free-for-all.


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