OTT (Over-The-Top) is one of the hot topics in our industry at the moment. I would be crazy to try and tackle the whole topic in this blog… so don’t worry, I won’t.
I want to focus on some of the challenges OTT presents for Rights Owners in the sports industry and how they can overcome these.
For starters, what does OTT mean?
OTT is fundamentally a way to deliver video content across an open network i.e. the internet. In the sports industry this is typically through an individual sport offering, e.g. NFL Now, European Tour TV, as opposed to a multi-genre content offering, e.g. Netflix, NowTV.
This content is accessed by connected devices, which can be categorised as:
1. Streaming media devices (Apple TV, Chromecast, Roku, Amazon Fire) & Games Consoles
2. Connected TVs
3. Browsers accessed via laptops
4. Tablet & Smartphone applications
Why is it so popular?
Well it’s generating revenue (which is helpful). According to a recent Juniper Research study, the OTT market is expected to reach $32 billion in revenue in 2019, up from $8 billion in 2014.
It’s also reaching a growing audience. In 2014, the number of shipped streaming media devices doubled, hitting 31m, helped by over 10m Chromecast. The market is forecast to grow a further 25% to 40m+ units by 2020.
For rights owners this can help support either a B2C strategy focused on delivering content direct to audiences, or supporting your rights holders in delivering the best digital experience to theirs and ultimately your audience. I’ve enjoyed working on both scenarios with our clients, each with their advantages.
Existing rights deals – do your broadcast rights deals include the majority of digital content exclusively? Being tied into existing agreements will limit, but not stop any movement in this space.
I’m certainly not saying that all rights holders should start planning to walk away from their existing broadcast partners – not at all! As we have seen with so many recent rights renewals, sport federations should not ignore TV just yet.
Fragmentation of the market – as I touched on earlier, OTT can extend across a range of platforms. In 2007, Netflix launched its streaming service & the first Apple TV entered the market, since then the number of players in the market has grown, but perhaps now we are at the tipping point, in particular for streaming media devices.
As often happens, Apple’s latest update to the Apple TV has attracted a lot of attention. Frost & Sullivan identified that Apple & Google accounted for 75% of all streaming media devices shipped in 2014 (with Roku at 13% and Amazon at 8%).
With consumption habits of audiences diversifying, that doesn’t just mean delivery to different platforms, but delivering relevant content in the right context for audiences. For rights holders with dedicated sports offerings, OTT is one of the strands in which they can own a direct relationship with their audiences.
Return On Objectives (ROO) – A far more quantifiable acronym than ROI. Of course, financial KPI’s may well be in your ROO, but it will enable you to consider OTT as part of a much larger communication strategy with your audience.
So how can you tackle these challenges?
Rights – straight away… If they’re your rights, are there any restrictions around dark markets? This allows content owners the ability to go direct to consumer, with the primary focus to discover and identify new audiences. These can be markets to grow and cultivate yourself or through a local rights holder.
Fragmentation – as suggested above, there appears to be some level of consolidation in buyers habits, although like any industry it will never remain static. It’s important when targeting audiences on these devices that you use a scalable CMS as the foundation to enable you to grow efficiently.
By separating content from the delivery platforms, you can ensure that content is treated with consistency, while enabling you to deliver individual user experiences relevant to the end device. This will result in both an engaging and connected user journey.
Most importantly – Adopting OTT enables you to know your audience directly and support a core component in a B2C strategy, therefore, gathering data on your global audience is vital. Understanding demographics, geographies, consumption & social habits of your audience requires a centralised user management platform.
This needs to provide support for commercialisation via payment platforms, CRM and communications; all of which allows you to analyse and refine your offering over time.
If you would like to discuss this topic further, please get in touch.