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“ Business models related to personalised advertising will grow in popularity .” - Nivedita Nouvel , Broadpeak
and how business models are dying . Some of the biggest providers are losing subscribers by the millions ,” notes Steve Nason , research director , Parks Associates . “ Traditional pay-TV still represents more than half of the market here in the US . The gap between those people and those who subscribe to OTT continues to widen . These people are migrating their habits online . Traditional pay-TV is still a pretty formidable part of the market for several reasons ,” he suggests .
“ A lot of service providers don ’ t just offer video , they offer broadband Internet , some offer home security , they offer mobile phone , they offer land line phone , they offer smart home solutions . So a lot of people are still bundling services , including TV , unlike OTT services , there are contracts , with long-term commitments . They are part of that long-term relationship and if they cancel out of that contract , there are termination fees , etcetera . I wouldn ’ t say pay-TV is a viable part of the video service ecosystem , because it ’ s declining , but it can ’ t be dismissed . Is it on its deathbed ? It ’ s entered the hospital , and needs some resuscitation , or new ways of living longer . It ’ s certainly not on its deathbed ,” he asserts . MISGUIDED . “ The premise that pay-TV is on its deathbed is misguided , as the majority of paid-for streaming services are delivered to consumers over broadband subscription services by their ISP who may also be their cable provider or telco ,” states Dr Abe Peled , chairman , Synamedia . “ Consumers have simply swapped a pay-TV monthly payment for multiple bills to different streaming providers while at the same time paying for a broadband subscription that gives them the bandwidth to cope with all the content they want to watch . By and large , consumers are paying more , albeit for a much richer choice of quality programming , given that original scripted content production investment has increased dramatically over the last few years .”
“ There will be no final blow , as the costs of content production and delivery to the viewers still have to be met - whether by advertising or , more likely , subscriptions . The real question is whether it will be paid to multiple D2C content providers and network providers , or will more affordable bundles re-emerge as some of the
savings from combined buying power can be passed back to consumers ? If so , will it be Disney +, Amazon Prime , local ISPs for local content , or the new kid on the block emerging as the new bundlers ?”
“ Rather than either giving the final blow , I anticipate both shifting and evolving to change pay-TV as we used to know it ,” predicts Martin Bergenwall , SVP and head of product management , Verimatrix . “ I think that both operators and network providers will leverage their market strengths and subscriber insights to uniquely embrace the efficiency of D2C . From a video delivery perspective , I can see network providers making use of D2C technologies in a B2B2C scenario , simplifying the delivery path from content providers to end users , but still serving pay-TV end users ,” he says . PARTNERS . “ We ’ ve always viewed OTT players as partners , not predators and were the first pay-TV provider to add Netflix and Amazon Prime Video to our TV platform ,” advises David Bouchier , chief TV and entertainment officer at Virgin Media . “ With the popularity of streaming apps surging , we will continue to work with content providers , not against them , to provide our customers with all of their favourite content in one place .”
Jonathan Broughton , managing director , WorkShare Consulting , agrees with Ampere ’ s Bisson on market variations . “ I think it ’ s still the case that the countries worst hit by a marked decline in pay-TV revenue are those countries which had the least competition , or choice of entertainment sources , to start with . This meant that they had driven up prices extremely
“ Pay-TV operators will play an important role in aggregating thirdparty services .” – David Sidebottom , Futuresource Consulting high and a lot of the declines that we are seeing could be considered a competition-led market adjustment , rather than a doomsday event . It ’ s clear that the US is extremely hard hit , and also fair to say that it is expected that not all pay-TV providers will survive the next 10 or even five years – but some will .”
“ In other countries , where pay-TV has always competed with other paid-for or free content options , the SVoD threat has caused a pause in growth , and in some cases a decline in revenue , but this is fairly limited and on the whole pay-TV companies have responded well by diversifying their offers . If I were to predict a death of pay-TV it would be via this route : pay-TV providers change their platforms and offers so much , that they are no longer pay-TV
providers , but broad service providers of which pay-TV is just one part of their overall offer ,” he concludes . So , if pay-TV survives , where , and in what form will it continue to exist ? “ Pay-TV will continue as an app aggregator with value added components such as Smart Home and IoT subsets ,” predicts Accedo ’ s Haleem . “ Delivering high-quality ( 4K / UHD ) major LIVE Sports will continue to be a reason for existence to pay-TV operators . The 10-feet experience for top entertainment content , even if it ’ s from Netflix , will be something for pay-TV operators to be involved in . Just look at how crucial Netflix integration is for any streaming device trying to enter the market ( Google Android TV for example ),” he observes .
“ Pay-TV will continue to be important for certain types of programming that lends itself much better to a linear TV schedule ,” says Broadcast Traffic Systems ’ Buckland . “ The most obvious example is of course live sports , with fans often willing to pay a premium to follow their favourite sport . We will however likely see pay-TV operators adopting a more varied approach to their offerings . We are already seeing many pay-TV operators delivering content through different channels , including their own OTT video services , offering a mix of both linear and on-demand content .
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