In Broadcast - January 2015 - 54

54

www.inbroadcast.com | Vol: 5 - Issue 1 | January 2015

InMedia

OTT Shows Promise,
But Hurdles Abound
Too many choices and a lack of popular content could hinder
the success of some aspects of OTT deployments reckons
Contributing Editor Michael Grotticelli...

T

hese days virtually every major
content owner/distributor in
the US (and elsewhere) is at least
considering implementing some type of
Over-The-Top (OTT) service that offers
singular on-demand video channels on
a variety of ﬁxed and portable display
devices.
That's because with current growth
that some say is in excess of 40% over
last year alone (albeit still currently at
only 2% to 3% of the overall market),
OTT video is gaining momentum as an
easy and cost-effective way for media
organisations to launch new channels
and get their programmes into the
hands (and living rooms) of consumers
around the world. And it's a good bet
globally as well. According to research
from ABI Research, the continued
adoption of connected consumer
electronics, Internet-enabled TVs
and mobile devices, like tablets and
smartphones, is expected to push the
OTT market past US$20 billion by the
end of 2015. The three largest OTT
markets are North America, Europe
and Asia-Paciﬁc.
For
multichannel
operators,
however, while the attractiveness of
TV services that allow users worldwide
to pick shows à la carte or by single
channels without a traditional bundled
pay-TV subscription might be strong
among "cord-cutting consumers,"
retaining those customers may not be
so easy.
These cable, satellite and Telco TV

operators still have to maintain their
allegiance to the content owners and
the respective carriage deals that are
now in place. Indeed, the challenge
for these guys is that they must give
subscribers the impression that they
are forward-looking and "consumer
friendly," while still holding on to the
status quo of selling some type of
bundled service.
It's a tricky balancing act that
operators must correctly navigate
or risk losing out to pure-play OTT
services like Hulu, Netﬂix and others
that will launch in 2015. In many
cases, exclusive content offerings will
garner the most attention and ﬁnancial
success. However, with so many
choices, there are no guarantees any
of these services will dominate.
OTT Services
That's why there are inherent
limitations (for consumers) with
these new services that are not being
publically discussed. For example, a
new OTT service from HBO/Cinemax,
set to launch this year, will initially be
marketed to the 10 million broadbandonly customers subscribed to a pay-TV
service. It (the data) is still managed
by the incumbent multichannel video
distributors HBO has worked with for
years, but gives the impression that
cord cutters are in control. In reality,
they aren't.
Sony also has unveiled PlayStation
Vue, an over-the-top subscription TV

Avoiding pay-TV subscriptions is not the sole reason given for "cutting the cord".
(Courtesy of Discovery.com)

service that will start off with about
75 channels per market (starting in
New York and then to be followed
later by Chicago, Philadelphia, and Los
Angeles). The cloud-based service will
run on PlayStation 4 and PlayStation
3 consoles and launch commercially
during the ﬁrst quarter of 2015. The
company said that it would add access
on iPads as well as more Sony and
non-Sony devices.

CBSN will be available on CBSNews.com
and its mobile website, connected TV
devices and the CBS News app

not carry any sports channels. And
to get any live streaming, customers
must live in one of 14 cities with a
CBS-owned-and-operated
station.
Again, it's giving the subscriber the
feeling of control, but not everyone
has access to that control. So, for a
monthly fee a customer can get access
to their local news if they live in a CBS
market, watch 15 primetime shows
the day after they air, access full past

PlayStation Vue brings live TV and a robust catalogue of content

Cloud-based TV
"Everyday TV is about to become
extraordinary with our new cloudbased TV service, PlayStation Vue,"
said Andrew House, President
and Group CEO of Sony Computer
Entertainment and group executive in
charge of the Network Entertainment
Business, in a statement when the
service was announced. "PlayStation
Vue reinvents the traditional viewing
experience so your programming
effortlessly ﬁnds you, enabling you to
watch much more of what you want
and search a lot less. PlayStation Vue
brings the best of live TV and a robust
catalogue of the latest content, always
keeping you connected to what's
popular, new and trending."
Also throwing its hat into the OTT
ring is a traditional over-the-air
broadcaster: CBS. The CBS News
and CBS Interactive divisions have
announced its own OTT multichannel
offering, called CBSN. The service will

seasons of popular shows and stream
5,000 episodes of older shows (which,
by the way, are already available on
other subscription-VOD services such
as Netﬂix, Amazon Prime and Hulu).
"CBSN is an important example of
how CBS is able to leverage the unique
strengths, talent and competitive
advantages of its businesses to create
exciting, highly competitive new
services that meet evolving audience
preferences for content consumption,"
said Leslie Moonves, President and
CEO, CBS Corporation, of the new
move to OTT. "There's a tremendous
opportunity on these platforms for a
true round-the-clock newscast. We're
conﬁdent this service will appeal to
both traditional news consumers and a
whole new set of viewers."
CBSN will be available on CBSNews.
com and its mobile website, connected
TV devices including Amazon Fire
TV, Roku players and Roku TV, and
others, as well as the newly launched
http://www.inbroadcast.com http://www.cbsnews.com/ http://www.CBSNews.com http://www.sony.com/ http://www.Discovery.com
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