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OTT Forcing European Broadcasters to Raise Their GameAnnouncements from multiple European broadcasters in the past week, some explicitly mentioning Netflix Inc. (Nasdaq: NFLX), demonstrate the impact of OTT competition. We are seeing a shake-up in the video market, and it's not just pay-TV providers nervous about cord-cutting; it's movie studios and broadcasters that are also having to develop new multiscreen strategies. In a previous post we talked about Barry Diller's thoughts on the future of Hollywood studios, which have traditionally sat at the top of the video food-chain. But we are also seeing some movement in the broadcast space, both in the US and in Europe. In particular, I noticed three announcements this week from European broadcasters which reflect the competitive pressure they feel from OTT providers such as Netflix and Amazon. (See Streaming Is Stealing Hollywood's Mojo – Barry Diller.)
France Télévisions expects to bring in 800,000 paying subscribers over the next five years. It will charge less than the €9.99 ($10.63) charged by Netflix and the broadcaster will invest €10 million ($10.7 million) in the project.
The BBC iPlayer was a pioneering web video service when initially launched as a free catch-up service for BBC shows in 2007. It is used by more people than any other VoD service in the UK, but maintaining its position will require "doubling our reach, and quadrupling the time each person spends on it every week," according to the director-general.
Studio71 provides marketing, monetization, distribution and production services for video content on the Internet. It delivers 500 million video views per month within the German-speaking world, but also recently acquired a stake in US network Collective Digital Studio (now renamed Studio71), which extends its reach to 6 billion video views per month. ProSiebenSat.1 will also be investing in Finder Studios, a similar company co-founded by TF1 in France, and launching Studio71 in Italy as a joint venture with Mediaset. The group also plans to launch Studio71 in additional markets including Canada and the UK. The three broadcasters (TF1, Mediaset and ProSiebenSat.1) are already part of the European Media Alliance, a network of major European broadcasters created to exploit possible synergies and leverage investment opportunities. These announcements underscore the pressure exerted by Netflix on broadcasters to invest in web-based services and maintain their viewership. In particular, broadcasters are concerned about younger audiences shifting their viewing away from traditional television channels. However, these announcements also highlight the challenge they will face. Netflix is rapidly becoming the large incumbent, rather than the startup challenger. France Télévisions, for example, plans to invest $10.7 million on its entire service, while Netflix is spending an estimated $5 billion on original programming alone. Netflix is already the top SVoD provider in France with 2 million subscribers, while second-placed CanalPlay reaches just over one quarter of that total -- 600,000 subscribers. Vivendi's decision to wind up its Watchever OTT service in Germany also points to the growing competition among OTT services themselves, and I suspect we'll see more services wound up in the next few years due to increasing fragmentation among a growing number of OTT services. (See Does Watchever's Demise Highlight a Looming Challenge for OTT?) — Aditya Kishore, Practice Leader, Video Transformation, Telco Transformation |
Contentious issues that are likely to fuel lawsuits and angry blogs in the coming year.
Content producers are unhappy with the advertising approach and revenues they are getting on Facebook Watch.
OTT video usage is driving the penetration of various Internet connected devices to help view online streams on the larger TV screen.
Major Hollywood studio to trial 'virtual' movie theaters using head-mounted displays.
Network technology vendor Sandvine has found that piracy isn't only hurting network operator profits – each pirated set-top box is also using up 1TB per month in 'phantom bandwidth.'
On-the-Air Thursdays Digital Audio
ARCHIVED | December 7, 2017, 12pm EST
Orange has been one of the leading proponents of SDN and NFV. In this Telco Transformation radio show, Orange's John Isch provides some perspective on his company's NFV/SDN journey.
Special Huawei Video
Huawei Network Transformation Seminar The adoption of virtualization technology and cloud architectures by telecom network operators is now well underway but there is still a long way to go before the transition to an era of Network Functions Cloudification (NFC) is complete. |
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