The Year of OTT?

Is 2015 the year the cord cutters really cut loose?

It was as far back as 2013 that, for the first time ever, the thirteen largest pay TV cable operators in the USA lost more video subscribers than they added – seeing almost 1.2 million subscribers cancel their TV service subscriptions and cut the cord. But it’s a dead certainty they weren’t cutting out TV viewing altogether. Instead, they were simply finding other ways to feed their viewing diet.

A recent article in the Huffington Post Tech highlighted the trend, stating that, “One day we may look back on 2015 as the year that pay TV began embracing the cord cutter’s dream: to pay only for the channels you actually watch.” And of course it’s not only the cord cutters who are helping to create this trend. It’s also the ‘cord nevers’ who have grown up with high-speed internet, and expect to be able to watch whatever they want, whenever they want, on any device they choose – not just on a TV in the corner of their sitting room.

So what does this growing minority use to replace cable access? The answer is content that’s delivered Over the Top (OTT)! Judging by the latest set of figures, this model is clearly proving successful for Netflix, who are making bold predictions about serving as many as 200 countries in the future. Meanwhile, Discovery has pulled their children’s TV content from Netflix, leading to speculation they are considering launching their own OTT service.

Implemented correctly, by leveraging the right delivery platform, content providers can manage their own destiny and cut the cord to expensive legacy CDN providers, just as consumers are cutting the cord to expensive cable providers. There’s no reason why content providers can’t ‘own the eyeballs’, take out the middlemen and keep the revenues themselves. Equally important, they can do so while cutting their OPEX and delivery costs – achieving a blazing fast return on investment.

But when everyone’s doing it, the successful ones do it better. Which means the content owners and aggregators deliver a differentiated Quality of Experience. One of the best ways of achieving this is using a simple, highly scalable delivery platform, such as Edgeware’s Video Consolidation Platform (VCP).

This not only ensures the highest Quality of Experience (QoE) on any screen, the CDN management functions enable effective monetisation of OTT video traffic. This includes unique ‘video awareness’, which makes it possible to handle QoE measurement and assurance via a succinct view of the adaptive streaming environment. That’s not just a ‘nice-to-have’ but a necessity for assuring maximum monetisation.

All in all, it looks like a win for the content providers and a win for their consumers – the cord cutters and cord nevers. So there are good financial and operational reasons why OTT is looming increasingly large on the industry’s radar. Perhaps the claim that 2015 is ‘The Year of OTT’ isn’t at all, well, OTT.

Find out how to reduce content congestion across your network and maximise QoE, with the bonus of eliminating frustration with our OTT whitepaper.

Author:

Matt Parker
Director, New Business Development

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