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OTT: The Way Ahead

OTT: The Way Ahead

Over-the-top content (OTT) service providers like Hulu, Netflix, and Amazon are showing massive uptake by consumers who want to view content as per their choice of time and platform. According to Juniper Research titled Mobile & Online TV & Video: OTT, IPTV & Connected Markets 2015-2019[1], OTT subscription is forecasted to generate $31.6 billion in revenue by 2019.

As traditional broadcasters face increased competition from OTT service providers, let us take a look at the future of OTT.

New providers in the market

While countries like the United States have already adopted OTT and are on the verge of saturation, developing countries with high mobile penetration and adoption rates of pay-TV and broadband are witnessing increasing popularity of OTT services. A  Digital TV Europe Research[2] estimates that developing countries like Eastern Europe, Middle East & Africa will see greater growth in revenues and that of Latin America will nearly triple from 2015.

Driven by rising mobile data usage, mobile is becoming an important medium to deliver OTT service in East European countries, Middle East & Africa. Pay-TV providers, mobile operators, broadcasters and media companies are expanding their OTT services in these regions either by launching their OTT services or partnering with regional OTT players. For example, UAE-based mobile operator Etlisat has introduced eLife ON, Saudi Arabian Mobily has mView, Times Media Group has an OTT service called VIDI in South Africa, and Pay-TV operator OSN has launched GO across MENA.

SVOD is catching up

Viewers are increasingly opting for OTT services like Hulu, Netflix, and Amazon Video, which gives them the freedom to choose the content they want to consume across different platforms. Millennials are adopting subscription video-on-demand (SVOD) services faster than their older counterparts. A report from BI Intelligence highlights younger viewers watch four times as much video content online than aged viewers. The popularity of SVOD services like YouTube, Sling TV, and PlayStation Vue further underlines this fact.

For SVOD services, usability is the key. Companies need to innovate to leverage OTT and SVOD services to reach out to more viewers. For example, YouTube has launched offline viewing for consumers to download videos and watch it at their convenience – even when there is no mobile connectivity.

With the first screen of the millennials being the mobile screen, digitization provides a huge opportunity for SVOD providers to grow their business. Content creators and marketers can reap the benefits from SVOD adoption. Content creators can profit from the surge in the short-form video, while marketers can capitalize on advanced product placements.

More connected TVs

Thanks to connected TVs, which include streaming devices like Apple TV, gaming consoles, Web-enabled TV sets, and TVs connected to the Internet by laptops in the group, monetization is also growing. According to FreeWheel, an ad-serving company whose clients include major video providers such as AOL, Crackle, Fox, NBCUniversal, Viacom, and Vevo, more than one-third of monetization was led by OTT devices. An eMarketer report[3] estimates that by 2018, 191.4 million or 58.2 percent of the U.S. population will use a connected TV device to access the Internet.

Changing fundamentals of content creation

OTT has unlocked transformational changes in how the content is created and consumed. The availability of unlimited content space has given more freedom to experiment and has provided audiences for all kinds of content. Although most are amateurs, some are earning millions of dollars, while contributing to the depth and breadth of content available to consumers.

Further, the increase of mobile and streaming access has enhanced consumers’ ability to choose what they watch and where and when they watch it. With the rise in mobile use, the demand for short-form, high-quality content, also called ‘snackable content’ has also witnessed a massive growth. Consumers are turning to live, user-generated video and “citizen journalists” for news related to developing events or stories. For example, The Young Turks, which offers short-form news videos on relevant topics around the world every day has become a key news destination for millennials.

The launch of Facebook Live in April 2016, which makes it easier “to create, share, and discover live videos” further highlights the changing fundamentals of content creation. Content creators are also focusing on introducing contextual parameters for content discovery. Factors like mood and current affairs are being taken into account apart from their viewing preference while making a content recommendation to the viewers.

To ensure successful adoption of OTT, service providers must address three critical challenges – aggregation, subscription churn, and transparency. As consumers look to fulfill the 3Ws – watch what they want, when they want to, and where they want – OTT providers not only need to manage content but also create new content and recreate legacy content to retain subscribers. Proper archiving, digitization and tagging of content will help in aggregation while generating content across various formats will provide shared experience across devices and help in customer retention.

[1] https://www.juniperresearch.com/press/press-releases/ott-tv-market-to-increase-fourfold-reaching-32bn

[2] https://www.digitaltvresearch.com/ugc/Global%20OTT%202016%20TOC_toc_149.pdf

[3] http://digiday.com/platforms/ott-video-going-5-charts/

Top 6 Threats for Television Broadcasters

Top 6 Threats for Television Broadcasters

Streaming services have been threatening to take a bite out of linear TV broadcast viewership for quite some time. However, it is only recently that television broadcasters have begun to feel the threat. According to a study conducted by Michael Nathanson of MoffettNathanson, Netflix’s US subscribers were up to six percent in 2015 from 4.4 percent in 2014.

As the future of television broadcast is threatened, we list six top challenges faced by broadcasters due to the rise of digital and streaming media.

1. The Rise of Alternative Media Channels

With the digital revolution gaining momentum, viewers now want to cherry pick their favorite channels, which is why streaming services over the internet are on an all-time rise. There has been a shift in the viewing habits, posing a threat to the decade-old model built around satellite and cable TV offering ‘bundled’ channels to consumers at a fixed price that offered little choice to viewers.

Now, viewers can access video channels like Amazon video, Netflix, Hulu; choose a subscription of individual channels like Showtime or HBO, or watch programs streamed on YouTube and other free online channels.

With the rise of alternative media channels, television broadcasters are facing a major threat in the form of what is popularly known as ‘cord cutting.’ According to a 2016 research by Leichtman Research Group , the cord-cutting trend began in 2013 when cable providers lost 100,000 subscribers. The figures went up to 150,000 in 2014 and 385,000 in 2015, thanks to on-demand platforms like Netflix that charge a fraction of what television broadcasters charge to stream programs.

2. Content and Network Security

Missed your favorite prime-time show? Login online to watch it anytime you want. Viewers now have the option to enjoy their favorite programs on any smart devices anytime they want. With the emergence of TV Everywhere, pay-tv operators are now offering TV Everywhere to provide value add and retain their subscribers.

However, TV Everywhere has its risks for broadcasters. As broadcasters use new media platforms to reach their millennial viewers, they are prone to security threats like hacking, malware, and cyber-attacks. Often, viewers also compromise their security by sharing devices, accounts and personal information to access the content, thereby giving easy access to hackers. Moreover, with the easy availability of network infrastructures, programs are being redistributed in real-time over the Internet illegally, resulting in loss of estimated billions of euros across the TV industry worldwide.

To address this challenge, broadcasters need proper infrastructure, security policies, and firewall protection to ensure hackers do not have access to the content. Moreover, old content needs to be digitized, archived and stored with proper tagging to ensure long term usage.

3. Changing Viewer Behavior and Preferences

As new digital platforms evolve, there is a distinct shift in consumer behavior and preferences. Users no longer consume what is being offered to them, but choose from a host of options available to them anywhere, anytime across multiple channels.

Traditional content providers are fighting hard to ride the digital wave and secure their place in the value chain by understanding customers’ interests and upselling the right products to cater to their preferences. TV broadcasters are facing a significant threat due to changing preference of the viewers and need to create and recycle content to cater to the changing behavior.

4. Content Protection and Piracy

In a world where news and videos go viral in minutes, content can travel across geographies fast. Thanks to the Internet, viewers now have the power to generate the content they like, share it with the world and gain instant popularity.

However, reliability and accuracy of such content remain a concern. Broadcasters might get into legal hassles like copyright issues or defamation if the authenticity of user-generated content is not verified. Similarly, illegal commercial distribution of content originally owned and produced by broadcasters may lead to revenue loss.

5. Mismanaged Content

Mismanaged content is a major challenge that broadcasters face today. While there is a lot of new content generated both by the user and broadcasters every minute, it might not be organized for future usage. Much of the content is not tagged correctly and do not have metadata, which makes it impossible for broadcasters to compartmentalize for reuse, often leading to content duplication.

With a huge amount of content already being created alongside legacy content, broadcast organizations need to organize and tag content to ensure easy search, access and distribution of existing content.

6. Lack of Quality Content

With modern technology and changing of viewers’ preference, there is a huge demand for content. However, to meet the growing need, quality of the content often takes a backseat.

To ensure quality, broadcasters need to utilize the content that is already in use. Recycling legacy content and going regional to cater to different geographies are some of the measures that content creators need to take apart from creating new content.

The television industry is gearing up to meet the digitization challenge. As viewers are spoiled for choice, the television ecology is becoming more democratic. Broadcasters are propagating online programs to catch the viewers’ attention and become accessible to new audience.

The Tube Goes Personal- My Television, My Time, My Way

The Tube Goes Personal- My Television, My Time, My Way

The Tube Goes Personal

It was just another lazy Saturday noon at 41, Manchester lane for the Smiths. Everyone in the family was busy with their routine weekend affairs. Jenny was busy with her preparations for the dinner they were hosting for their family friends and was hoping to get a helping hand from her teenage kids Amber and Alex. She exclaimed looking at her teenage son, Alex “God knows what these kids to up to! They are always hooked to their mobile phones and iPads.”  It was half past seven and Alex was still completely engrossed in his tablet, watching something with rapt attention. Out of sheer curiosity and a bit of anger, Jenny took a peak into Alex’s screen trying to figure what he was glued to.

What Alex shared was a revelation for his mother. He explained how he can catch up on his favorite TV series on his smart phone or a tablet as and when he gets time. The very thought of watching her favorite shows without having to fight for the remote made Jenny smile, and she was super excited to learn that she can enjoy all of her sops simply by downloading an app on her mobile.

A global research suggests that an adult-internet user spends almost 20 hours per week online – consuming media. Interestingly, for the first time ever, Britons will spend around GBP 1.31 billion on video streaming subscriptions and film/TV downloads in 2016, more than on buying and renting DVDs.

My Television, My Way:  Happy Viewers

Television has been constantly reinventing itself and today, it has transformed itself from an idiot box to a smart device offering a personalized experience.  There were times when watching television was a family affair but with growing options, reach and changing preferences, there is a major change in content consumption patterns. While the previous generations fret over missing an episode, the modern viewer is consuming content in a whole new way.

OTT services providers like Netflix, Hulu, Amazon , beIN Connect etc. are now offering subscription based services to consumers on one end and are investing on sourcing content. Netflix has even taken a step forward by entering into production of content.

Cord cutting (the term used for viewers cancelling their television subscription services for alternate content sources) is now catching up with millennials around the world. As a viewer, on-demand TV gives them a choice to watch the content they like anytime, anywhere and on any device.

Getting Heard:  A Marketer’s Delight    

OTT, SVOD, Mobile TV are a fantastic medium for marketers to reach out their audience. Not only does it offer targeted advertising options but it offers meaningful insights for marketers to analyze and optimize their campaigns.  The result is impactful campaigns, reduced media spill and improved ROI.

Feed the Appetite: Content for the Consumers

With this trend shift, the industry is more focused on creating content to cater to the diverse set of viewers. While creating new content is important, re-purposing old content to make it accessible is also equally important. Digitization and management of old content in various formats is necessary for the survival of the heritage. Because, the new generation may not have read the works of Jane Austen, but chances are they would not have missed ‘Emma Approved’, the web-series based on her popular novel Emma.

Audiovisual Content Monetization: How Ready Are You?

Audiovisual Content Monetization: How Ready Are You?

Television is no more the only go-to entertainment device. According to a report[1], as viewers consume TV shows and movies in various devices on-the-go, television has lost 13 percent of its viewers in 2015.

With the millennials abandoning television faster than anybody else, broadcasters are aggressively exploring new ways to package content and share it across multiple platforms. Consumers now want more variety and quality content to be delivered to the right device at the right price, which is why providers are looking beyond repackaging the same old content to make it available.

As content becomes the leading online commodity, broadcasters and media organizations are trying to monetize their content. The need to create, convert, and manage digital content has brought forth new technologies, competitive paradigms, and business dynamics in the industry.

Consumers now expect instant access of all content – news, entertainment, corporate, social, media or personal across devices. This has resulted in companies innovating to create ways to monetize content. The biggest challenge that organizations are facing is not technology but availability of content in the consumable format. If monetization is the immediate priority, content owners need to focus on:

  1. Digitization of their historic analog content
  2. Management and optimization of newly produced content

A lot of content still lies in old format like video tapes or film. Organizations need to convert these to digital files and create relevant metadata and support index to aid effective and seamless content retrieval. To facilitate this, content curators need to assess the audio-visual assets to determine the appropriate platform to store, access and distribute the content. Moreover, content, as an asset, needs to be managed well to ensure optimal distribution across channels to generate parallel revenue streams.

Once digitized and managed well, media asset managers not only undertake the effort to digitize and manage content to ensure easy search and availability, they also present an array of options to monetize the content.

Subscription Plan

Common for all types of digital content, be it gaming, streaming content (like Hulu, Spotify, or Netflix), software, or magazine and newspapers, subscription model primarily use paywalls, through which users subscribe to content for a monthly or annual fee. Broadcasters have the option of implementing paywall after a free trial, immediately on consuming the content, or pay-as-per-use. Some content are also charged after a specific number of views, which allows broadcasters to generate revenue from ad.

Transaction Plan

Consumers have access to digital content after paying one-time transaction fee, where they pay-to-own the track, movie, image, or article, or pay multiple times as they use the content. Multiple transactions allow users to have time limited access of content and applications. iTunes and YouTube movies are examples of content being available in this model.

Freemium Plan

Under this plan, content is offered for free, while the broadcasters charge premium for selective content. For example, Angry Birds game is available for free, but users need to pay for an ad-free version or to purchase goods and levels within the game.

Ad-support Plan

Common across digital verticals, ad-supported free content earns revenue from ads, like banner or C. While content is provided free, advertisers use the platform to run ad campaigns and pays the content owner for using the platform.

While organizations try different plans across different platforms to broadcast and monetize content, what needs to be kept in mind is one-size-fits-all doesn’t work for all content owners. Media asset managers and broadcasters need to identify the ideal plan that suits the overall business objectives of the organization.

[1] https://www.accenture.com/us-en/insight-digital-video-connected-consumer