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“ We already see a variety of payment models ,” suggests McCarthy . “ OTT D2C players have been instrumental in breaking the shackles of annual contracts . Without the need to subsidise a set-top box and installation costs , protect an existing revenue stream , and without the restrictions of antiquated CRM and provisioning systems , they can be very flexible in their business models . They have brought in a wide variety of models including free , ad-supported , freemium , paid , pay-perview , monthly subscription , prepaid , etc for consumers to choose from .”
“ New payment models will be centred around bundles that leverage the flexibility of à la carte OTT services with the basic value proposition that comes with pay-TV ( e . g ., bundle pricing ),” predicts Routt . “ Consumers want both and , since pay-TV providers own the billing , they are in the best position to innovate in this area . We may see pay-TV operators experiment with enhancements to their billing capabilities to enable the types of integrations and seamless billing experiences that users expect from a service provider who offers bundles of first and third party services .” PORTAL . “ The cost of content is putting pressure on household budgets at a time of increased concerns about affordability and value ,” notes Eisenberg . “ One way to manage this would be through a ‘ portal ’ to manage all your spend , with personal recommendations that will allow you to control it better . So for example , if you like Billions on NOW TV , you finish watching it and then stop NOW TV for two months and instead subscribe to Starz Play channel on Amazon . There is a real opportunity here for someone to provide this portal , it could either be a large device-based platform such as Amazon or Apple , or it could be a service provider , typically a telco . Unified billing is no mean feat , but the prize is significant ,” he suggests .
“ The pay-TV industry is suffering because it has failed to adapt or innovate its billing , packaging and pricing in decades ,” asserts Teresa Cottam , chief analyst at Omnisperience . “ The industry ’ s current approach is oldfashioned , still reflects linear broadcasting models , and fails to take account of key trends such as personalisation , contextualisation ,
“ A provider can be a federated service bringing convenience and value for the viewer .” - Adam Davies , Synamedia self-bundling and impulse buying . Netflix ’ s recent crackdown on password sharing is a good example of a missed opportunity . While no-one can argue that avoiding payment by letting your friends use your account is wrong , if someone has paid for a number of slots in their package then they should be entitled to use them . Software companies don ’ t usually demand you live in the same physical location to share a package .”
“ Unbundling pay- TV offers even more opportunities . Allowing customers to self-bundle options according to their interests enables selfpersonalisation . Pay-TV companies should have content rules that say a customer is entitled to X number of series and Y number of films and then allow the customer to choose what they put in their package . Content could be designated as premium or sub-premium with different numbers of each type permitted within the bundle . At the same time they should enable easier impulse buying . There ’ s a general failure to monetise ad hoc purchasing because access to a single piece of content is discouraged or requires the customer to put in significant effort ( for example , to set up a billing account ). Figuring out how to sell customers ad hoc content would significantly increase the addressable market ,” she suggests .
“ In fact there ’ s a large and untapped market of potential viewers who are prepared to pay for content but are currently excluded because of subscription models . This includes those who only watch content intermittently who don ’ t feel the value in subscription packages ; the credit-challenged ; those who cannot afford subscriptions ; and customers in developing markets that have prepaid accounts . This is where real innovation is possible . In fact
“ Pay-TV is an effective content aggregator and can deliver high quality video with minimum delay .” - Martin Bergenwall , Verimatrix
there ’ s huge amounts of pricing , packaging and charging innovation possible , and huge untapped audiences , if pay-TV companies are willing to grab the opportunities presented ,” she concludes . INTEGRATED . “ With the number of streaming apps growing all the time , consumers are managing more bills and subscriptions than ever ,” notes Bouchier . “ By providing integrated billing for services like Netflix on our TV platform , we ’ re allowing customers to keep track of costs in one place and believe the demand for this aggregated payment model will become even more prominent in future .”
Broughton suggests the so-called ALCA services are more akin to the Nordic telco models of the early 2010 ’ s whereby everything was available à la carte , and there was not a bundle in sight . “ Bundles are great for media as consumers end up with more stuff than they would if they bought separately , while bundles also encourage higher spend and the industry makes more as a whole . It does feel like à la carte business models will be increasingly prominent in the average consumer subscription library , but it ’ s also hopeful that traditional aggregators will find ways to claw this back from being purely à la carte – perhaps making a Disney / Netflix / Amazon bundle an essential part of the consumer ’ s menu ,” he adds . Will third-party UI and discovery become significant factors ? “ Third-party UI and discovery will certainly be extremely significant ,” says Aleem . “ Being able to easily discover content across multiple video services from one central location will dramatically change the consumer experience . It will also be a major factor when it comes to buying content based on pricing mechanism , content quality ( SD , HD & UHD ), rental period etc . For a bundle subscription to work effectively , pay-TV providers will need a UI which can be personalised based on the user , such as family viewing , adults , kids , sports , etcetera .”
As well as exploring
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