 | Issue: | North America I 2014 |
| Article no.: | 5 | |
| Topic: | The Cloud crushes the barriers to true OTT TV Everywhere | |
| Author: | Louis C Schwartz | |
| Title: | CEO | |
| Organisation: | UUX | |
| PDF size: | 224KB |
About author
Louis C. Schwartzis the CEO of UUX. He has over 20 years of experience as an entrepreneur, operating executive and attorney in the digital media space. In 2000, Lou co-founded and served as the Chairman and CEO of Multicast Media Technologies, Inc. (“Multicast”), one of the first global online video platform companies to reshape the way organizations create, manage and leverage video to communicate with their target audiences.
Lou orchestrated the sale of Multicast to Piksel, Inc. (formerly KIT digital, Inc.) in 2010 and assumed the role of CEO of the Americas and then Global General Counsel of Piksel.
Lou’s latest venture, UUX, is the result of two merged companies (Totalmovie and OTT Networks) to create one of the first white-labelled Pay TV-as-a-service offerings for mobile carriers around the world. The service is intended to provide mobile carriers with an end-to-end service platform for delivering linear and VOD content to all IP connected devices. As CEO of UUX, Lou is driving the company’s corporate strategy to increase distribution, subscriber adoption and monetization of next-generation Pay TV services over wireless networks.
Lou has won several entrepreneurship awards, and is an internationally recognized expert in new media and IP video convergence.
Article abstract
TV everywhere is experiencing huge growth, which poses three main challenges: broadband access, scalability and billing. Combining multiscreen OTT TV with Cloud technology has considerable advantages to both mobile carriers and content providers, leveraging mobility, cost effective storage, local distribution and most importantly – mobile based billing, especially where users are wary of credit facilities. A cloud based OTT TV can cope with the tremendous growth in traffic, and mobile carriers can optimize the transport in places where broadband capacity is not sufficient, thus ensuring users’ quality experience.
Full Article
Part of the huge increase in data held in the cloud can be attributed to the launch of cloud powered TV services. Online and mobile video consumption are growing at an especially fast pace in Africa, APAC, LATAM and the Middle East: 2013 saw 42 million online video viewers in APAC and OTT penetration is already estimated at over a million in a number of countries in LATAM.
OTT growth is not limited to emerging markets. A report carried out by ABI Research, titled OTT & Multiscreen Services Research in April 2013, found OTT video revenue exceeded US$8 billion in 2012, with North America accounting for 57% of global revenue. It also predicted that revenue will reach the US$20 billion mark by 2015. Both the US and Canada have seen OTT growth of over 50% in the past few years and it appears this momentum shows no signs of slowing down.
TV Everywhere is becoming ever more popular in these developing regions, which requires operators to make radical transformations to the networks. As end users increasingly seek a single platform catering to all their video consumption needs, multiscreen service providers have to deploy a full end to end offering which is compatible with mobile enabled devices. The rising demand for true TV Everywhere services in these markets is a revolution in the connected entertainment industry, which needs to offer services that solve three main challenges: broadband access, scalability and billing.
The emergence of the cloud offers the chance to address these issues and improve interactions between content providers and mobile operators, who are pivotal in the adoption of multi-screen in emerging markets. As these markets become crucial for broadcasters and OTT service providers, adapting the services to the end users most deep-seated habits will be key in delivering the connected entertainment they desire Leveraging the cloud enables operators to target these customers wherever they are with a video service optimized for mobile, removing the barriers to service adoption and integrating with telecom operators’ existing billing system. As mobile devices come to be regarded as the primary screen, stronger bonds will form between the connected entertainment industry and the mobile carriers, enabling new business models.
Cloud-based platforms offer mobile network operators an agnostic, market ready solution which meets the challenges of regions where broadband infrastructure is not yet developed. As more and more multi-screen services become dependent on the cloud, content owners, broadcasters and service providers need to update the tools with which they access a network. This is particularly crucial for VoD, which is set to grow from US$21 billion in 2013 to over US$45billion in 2018, a Compound Actual Growth Rate (CAGR) of 16.5% according to research by MarketsandMarkets. Consumer demand for high quality content across any connected device is considered the main factor leading to such tremendous growth. The study also finds that the consumer’s TV experience is veering away from a linear one to a model which demands high quality content across any connected device. OTT viewers especially are surpassing IPTV viewers in the realm of VOD, with North America expected to be the biggest market in terms of revenue contribution while APAC and LATAM are expected to experience increased market traction during the forecast period.
Moving forward, the consumer craving for a more personalised television experience will have a significant impact on the amount of data stored in the cloud. As the cloud becomes more and more prevalent, it will see OTT providers go beyond merely distributing content to offering additional services to providers in the form of marketing tools and expertise, which will result in new forms of monetization. OTT operators are placing more of their workload into the cloud as it offers advantages such as rapid access to multi-screen content and services.
Cloud and OTT convergence will see new business models emerge
Some of the more established OTT providers have failed to make a mark in developing markets. For example, in LATAM, a large scale OTT provider ran into billing issues after launching with a direct debit payment method in Brazil and through debit card payments in Mexico. The provider ultimately failed due to offering North American payment methods rather than tailoring for the region, where consumers prefer mobile phone payment instead of direct debit or credit/debit card billing. The lesson is that OTT service providers must be careful to adapt to local customs and habits when launching in new territories.
The emergence of cloud-based OTT TV platforms has seen a surge in multiscreen across the globe. This continued convergence between the cloud and OTT will mean that business models will undoubtedly shift as service providers create models which allow them to handle content, metadata, processing and billing over the cloud.
Carriers are utilizing the cloud in order to enhance multiscreen services, migrate IP operations and lower the costs of geographical expansion. The cloud also provides the opportunity to deliver a high calibre OTT service where there is a poor broadband infrastructure by leveraging the telco network, thus enabling those from developing nations to benefit from multiscreen services.
The growing demand for content, 24/7 viewing hours and high-quality viewing experiences across a multitude of devices means that current technologies cannot compete as the process becomes more expensive and complex. The cloud negates these problems by allowing broadcasters more scalability and control over their environment than hardware ever could.
OTT becomes more scalable via the cloud
The cloud is also natively scalable: storage can be expanded through virtual servers, enabling operators to store larger files such as 4K content in the cloud. It prompts brands to assess their platforms and their delivery models, to enable streamlined delivery. For example, in-house solutions of OTT delivery of live sports, which is becoming ever more popular, find it difficult to cope with the massive increases in traffic in a cost effective way, whereas the cloud can streamline that delivery due to the virtualization of hardware.
As more and more services turn to the cloud in this zettabyte era in which larger amounts of data flow freely, it is imperative that providers pick their multiscreen partners wisely, to ensure seamless content delivery. A solution which encompasses preparation, rights and security and choosing the right multiscreen partner will allow for better agility into the cloud.
The most fundamental part of ensuring a successful OTT service is to provide high quality user experience. This is achieved through proper workflows, transcoding, security etc., which can all be hosted and delivered via the cloud, ensuring consistently good user experience.
iTaaS solutions offer a unique opportunity
Service providers have a unique opportunity to make the most of the move from physical to IP networks by developing strong OTT partnership strategies, taking advantage of emerging technologies such as Infrastructure as a Service (IaaS) cloud hosting solutions.
From a video perspective, a cloud-based Internet TV as-a-Service (iTaaS) platform offers mobile network operators a fully agnostic, market ready solution that meets the challenges of markets where broadband infrastructure is not mature. This end-to-end platform can be specifically optimized for mobile billing, thus allowing the mobile operator to utilize the existing billing system. It can even provide the operator with its own branded service which can be brought to market swiftly.
The cloud is part of the seismic shift that is occurring in the Pay-TV world, where operators are adding OTT elements to their service portfolio. The iTaaS model can deliver a wide range of services, including Live, Catch-Up, Cloud DVR and VOD, consumer applications, personalization and management, to name but a few.
iTaaS has the additional benefit of being able to slash CAPEX and to reach smartphones and tablets regardless of where they are in the world. The universal appeal of an iTaaS platform is perfectly suited to developing markets where it’s hard for new market entrants to develop a billing relationship with customers.
OTT technology is shaking up the traditional forms of communications in the telco industry. By adopting an expansive IaaS cloud hosting strategy, service providers use high end network assets to formulate inter-dependent relationships with developers. This new collaboration will ultimately see telcos and OTT providers take more market share as they monetize these innovative top level approaches.
The cloud is synonymous with mobility, which places telcos in a unique position to leverage partnerships and offer agile systems. By leveraging solutions which support billing requirements, integrated platforms and content expertise, the cloud provides compelling OTT opportunities.
