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ott story_ott cover story 21/04/2015 20:35 Page 3 OTT providers, these are real risks. “It’s worth noting that linear TV is still by far the most valuable asset and so it will be interesting to see how linear OTT will develop over the coming years. It seems that the best route is one of collaboration between OTT and linear TV (FTA or pay-TV) operators in each country,” he notes. RIGHTS. “Some OTT vendors have grown sufficiently large that content security is now critical; they are attractive enough for highcost hacking attempts to be made. In relation to Service Providers’ OTT services, we have seen that content rights, although evolving slowly, are still typically lagging compared to OTT capabilities and the demands from viewers. For instance, the rights to provide time shift TV and cloud DVR services, both of which have proven to be of high interest to subscribers, are still inconsistently available (or unavailable) depending on country and content provider,” he advises. Trudelle agrees that such factors constitute legitimate hurdles to overcome to run a successful OTT TV business. “They indeed show the complexity of the new emerging OTT TV model, and these challenges are also a reality for incumbents that are adding OTT capabilities to their platforms. “Securing the OTT TV revenue model against fraud and piracy is clearly an area that will require sustained investment from service providers, and where companies like NAGRA, with a successful track record in the pay-TV space, can concretely contribute to the solution.” “On the business side, it’s clear that the economics of content production, sourcing or rights selling differ from other business drivers. OTT delivery can help all three dimensions, provided the proper sets of technologies and industrial partners are aligned to offer a superior service. The pay-TV business ecosystem has achieved this result “Over the next 20 years, Internet TV is going to replace linear TV.” Reed Hastings, Netflix with an impressive track record over the past two decades and is well positioned to leverage OTT the same way in the future,” he notes, suggesting that NAGRA can bring significant value to Service Providers, including to emerging OTT companies. According to Steve Christian, SVP marketing at Verimatrix, the OTT video landscape is muddied by an overall trend towards apps rather than browsers for accessing content, simply because tablets and smartphones have clearly been established as the second screen of choice for long-form and TV viewing. “Operators have embraced the app model for their branded services because apps put them fully in the driving seat of content access, discovery and also security. Even as HTML5 matures, the browser interface shows signs of becoming a battlefield of competing technology interests that will “Operators face a choice between stepping up investment in OTT and allowing competitors to come in.” Steve Christian, Verimatrix activities, and in particular from content delivery. Business volatility is not the same, and mixing two different company profiles within the same entity can lead to shareholder pressures to unlock the value of the better performing arm of the business at some point. Some OTT players could very well be split over time, or change their content strategies under such financial pressures,” he predicts. DIMENSIONS. “Down the road, content, experience and reach are the ultimate value 16 TV Everywhere complicate rather than simplify service profiles,” he suggests, adding that as consumers demand support for more devices to access their preferred OTT services, complexity seems likely to increase further, with operators required to support multiple streaming formats and DRMs native to browsers and device families. “One ca