Multi-Screen Video Presents Challenges & Opportunities for Global Service Providers

January 24, 2013
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Introduction

Multi-screen video content and capabilities are becoming ever more important to pay TV operators, such as AT&T U-Verse.  Multi-screen video content is usually transmitted over IP networks (often referred to as Over The Top or OTT video).  The video content is received by multiple devices, such as notebooks, tablets, and smart phones.  Ken Pyle has previously reported on this mega-trend.

Second screen apps, which we covered in this articlealso offer TV control, guide and navigation functions.

1.  Infonetics:  Multi-Screen TV Service Deployment Strategies

Earlier this week, market research firm Infonetics Research released excerpts from its new Multi-Screen TV Service Deployment Strategies: Global Service Provider Survey, for which Infonetics interviewed pay TV operators about their plans for multi-screen video services and delivering live and file-based video content to subscribers with multiple devices.

For this multi-screen TV survey, Infonetics interviewed purchase-decision makers at incumbent and cable operators from EMEA, North America , and Asia Pacific in November and December 2012 about their plans for delivering multi-screen video.The report was co-authored by Infonetics analysts Jeff Heynen and Julien Blin.  It provides insights into business drivers and challenges, technological challenges, types of devices and mobile operating systems supported, transcoding and delivery methods, number of broadcast channels and VOD (Video On Demand) titles offered, and value-added services.

Multi-Screen TV Survey Highlights:

  • Nearly half of survey respondents support tablets as part of their multi-screen service today, growing to 100% by 2014
  • When it comes to supporting mobile OS as part of a multi-screen service, 40% of operators interviewed prefer the Android and iOS platforms
  • Among survey respondents, the need to reduce churn and increase customer loyalty was rated a top business driver
  • Securing content licensing deals is the #1 business challenge facing respondent operators

Analyst Note:

“Multi-screen services are quickly becoming a critical service for pay TV operators worldwide,” notes Jeff Heynen , directing analyst for broadband access and pay TV at Infonetics Research. “By keeping attention focused on the content they’re providing, operators keep subscribers and advertisers happy.”

“But,” cautions Julien Blin , Infonetics’ directing analyst for consumer electronics and mobile broadband, “Significant challenges remain, particularly when it comes to securing licensing arrangements with  content owners who are concerned about the security of their content in a multi-screen world. This is also one of the major hurdles to offering á la carte cable content, a hot topic these days.”

To buy the report, contact Infonetics: http://www.infonetics.com/contact.asp


2. Pyramid Research: OTT Growth Sparks Innovative Business Models

Pyramid Research’s report, OTT Growth Sparks Innovative Multi-Screen Video Business Models, examines the growth of OTT video services and the impact on the traditional pay-TV market.  Five multiscreen business models are presented, with the advantages and disadvantages of each detailed. This report presents case studies from BT, Sky, AT&T, Turk Telekom and TotalPlay and examines how these different operators seek to develop successful business models for multiscreen video.

Pyramid notes that that telcos and MSOs have to deal with the exponential traffic growth generated by OTT videos, which puts a significant strain on their wireless and wireline networks. Nonetheless, the growth of OTT video is accelerating development of the multi-screen market and presents new opportunities for telcos to differentiate their services, increase customer loyalty and generate new revenue.

“The growth of OTT video services is disrupting the traditional pay-TV market and is dramatically driving traffic growth,” says Pyramid Research Analyst Daniele Tricarico, “but more consumers are watching video on multiple screens, opening up for new opportunities for pay-TV providers and telcos to implement multiscreen business models.”

Everywhere and multi-screen services are helping cablecos and satellite providers to increase customer loyalty and reduce churn. Multi-screen IPTV is helping telcos to increase loyalty and to generate new revenue by boosting migration from lower-value packages to higher-value multiplay bundles, including high-speed Internet, which is needed for better quality video.

“All pay-TV providers also have the option to launch their own OTT-like video services and extend their reach to non-customers, thus generating additional revenue beyond the existing customer base,” he adds.

For more information on this report, visit:

http://www.pyramidresearch.com/store/OTT-multiscreen-video-business-models.htm

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3 Responses to Multi-Screen Video Presents Challenges & Opportunities for Global Service Providers

  1. Sanjeev
    January 25, 2013 at 11:55 am

    Thanks for the article and comment. Here’s a related article:
    Why the Future of TV Still Isn’t Here Yet
    http://news.yahoo.com/why-future-tv-still-isnt-yet-191529852.html

    • January 25, 2013 at 12:14 pm

      Thank Sanjeev. That is a good reference – how to find content or how it can find you is almost as important as the content itself. The DIAL effort described in the Yahoo article seems to remove the friction of having to worry about opening apps and allows true M2M interaction:

      http://gigaom.com/2013/01/23/dial-open-airplay-competitor/

      Another piece to this app to app puzzle is the whole idea of content identification technologies to control the content on the second screen, based on what is being shown on the first screen. I was lucky enough to film an interview at CES between Fred Dawson had with Michael Strober of Turner. Maybe the most significant thing about this interview is that Strober is on the business side of Turner and is selling the benefits of the content identification capability to enhance 2nd screens to real-world sponsors.

      http://www.screenplaysmag.com/2013/01/11/michael-strober-turner/

      They are having success on mainstream programs, such as “The Big Bang Theory”. He also alludes to the idea that this may the year that one can purchase the “sweater” the actress is wearing based on content identification triggers. All these ideas were thought of and discussed for decades prior to today, but they are now coming to fruition in ways that are slightly different than envisioned by the iTV pioneers.

  2. January 24, 2013 at 10:38 am

    Thanks Alan for this summary of these two reports. One observation from talking with smaller to mid-size operators is that, although they see the need for multiscreen, they are still challenged to put together a comprehensive program.

    Part of that challenge has to do with priorities. Part of it also has to do with the continually changing landscape of new devices that require continuous development. This is a challenge for the small operators and larger operators, but especially small operators that don’t have the resources of their larger cousins.

    As alluded to in the above graph from Infonetics, content licensing is still and will probably continue to be the biggest challenge for operators. This is consistent with what I found in the referenced report as well as the follow-up report published at the beginning of last year – http://www.mrgco.com/reports/multiscreen-strategies-driving-profitability/

    At the same time,, MSV is a must-have, if the broadband providers want to continue to compete as video providers.The challenge is making it simple enough and robust enough that consumers will continue to use.

    For instance, I have tried my cable providers android app for professional reasons, but find that it takes to long too load and is non-responsive once it loads. Overall, not a good experience, which is an example of the challenge pointed out by Infonetics about managing customer expectations.

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