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What does the future hold for OTT?

Antonio Corrado, CEO, MainStreaming
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OTT is no longer the disruptor to the video industry.

Where once it was the unpredictable outsider, today it is fully embedded in the consumers’ psyche as a viable way to watch content. It’s even started setting an example for everyone else.

Just look at one of the major developments in TV in the last few years; the rise of online gaming and esports arguably would have never happened without OTT’s disruption. Another example is the recent Champions and Europa League finals, when BT streamed the matches freely over the Internet. That surely wouldn’t have happened a few years back.

As if you needed any more evidence of OTT’s place in the mainstream, consider this statistic – online streaming platforms produced the largest share of original shows in 2018, beating traditional broadcasters for the first time in history.

Looking further ahead, OTT is projected to continue growing faster than traditional delivery methods. A clear example of this is Netflix, Hulu and Amazon Prime’s ever-growing subscriber base. PWC’s Global Entertainment & Media Outlook 2018-2022 forecasts that revenues via traditional channels are set to decline by one per cent while Internet and mobile in contrast are set to grow by 18 per cent.

But taking a step back however, we need to ask are consumers getting what they want?

On the face of it, you’d be tempted to say they are. They have a near unlimited choice of options, spanning everything from live sports to the latest Hollywood blockbusters, all at the touch of a button to any device with an Internet connection.

However, with the so many different providers, each with their own USPs, and with the multitude of device options to stream to, such as Smart TVs, smartphones and laptops, it might be conceivable that maybe consumers have a little too much choice. With an infinite supply of separate OTT platforms, it’s not difficult to envision fragmentation and confusion.

The paradox of choice aside, this ever-expanding list of OTT players faces a different kind of challenge in the coming years – the challenge of their delivery mechanisms.

The streaming revolution isn’t on the horizon anymore – it’s already here and more broadcasters are abandoning traditional delivery methods every day, shifting from satellite to digital distribution of entertainment.

By operating over the open Internet, they face the challenge of guaranteeing quality of experience for their customers – after all, consumers today won’t stand for latency or technical issues.

Although the deployment of 5G is expected to make video delivery up to 100 times faster, the flipside is that it will also make consumers even more demanding. With the global average of online video consumption also expected to grow to 84 minutes a day by 2020, broadcasters should be ever-mindful of the size of the task at hand; they need to stream an unprecedented amount of video with the highest quality of experience over the Internet, giving viewers something they can’t get with traditional TV today.

With yet more growth of these digital platforms projected, increasingly powered by 5G, it looks as though broadcasters will work more with mediators to help them manage this change, enabling them to compete more strongly and gain the attention (and trust) of distracted and demanding audiences.

The bottom line is, operators must ensure that infrastructure is at the heart of any investments they make if they’re to ensure their future.

One of the biggest trends happening right now in the world of sports, that also has the opportunity to effect broadcasters and the content they stream to audiences, is the growth of online gaming and esports.

This year, the number of viewers that frequently watch their favourite gamers play the most popular games is expected to grow by 30 per cent on 2018’s figure of 165 million – without mentioning the extra 215 million viewers that watch occasionally. This showcases a new demographic that didn’t exist five years ago and will not be the only one that changes what traditional broadcasters stream to audiences, as taste in content continues to evolve with the ease of access that OTT provides.

Nonetheless, one thing that is certain is that video will still be king in the coming years. Whether it’s 5G-powered or not, streaming is now a reliable and proven technology, enabling viewers to watch their preferred content when they want to, and it’s up to broadcasters to ensure they have the infrastructure in place to provide the highest quality of experience to the next generation of consumers.

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