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LiveRail: What’s the future for 24/7 streaming networks?

Yoav Arnstein,  GM EMEA,  LiveRail

Yoav Arnstein,
GM EMEA,
LiveRail

By Yoav Arnstein, GM EMEA, LiveRail

The recent launch of the WWE Network as the world’s first 24/7 streaming video service raises several questions, the most important ones being Why, How and What’s Next?

Why?

Consumers’ appetite for control over video consumption is growing fast, along with the rapidly evolving broadcast and cable landscape. When such asymmetry exists, you would expect companies to try and create friction. It is a great reason to launch a different video service.

With the improvement in delivery of high-quality content over multiple devices, the richer user interfaces of digital platforms and the greater convenience of on-demand connectivity, a 24-hour video network unshackled from the distribution methods of cable or satellite, just makes intrinsic sense.

How?

A 24/7 streaming service, like WWE Network, needs to be equally accessible on three different platforms: Over-the-Top (OTT), App-Based Devices and Smart TVs/Connected TVs:

  • Over-the-Top (OTT)

The WWE Network is delivered directly to desktops and laptops via WWE.com.

  • App-Based Devices

The WWE Network is available through apps on devices such asAndroid phones and tablets,Apple iPhones and iPads, Amazon Kindle Fire tablets, Roku streaming devices, and game platforms like Sony PlayStation and Xbox.

  • Smart TVs/Connected TVs

This is the final piece of the puzzle, with WWE Network scheduled to add this delivery method over the summer.

What’s Next?

Although we share in the excitement of innovative and disruptive approaches, we must remember that many challenges still exist for services that aim to reach independent and scalable distribution of video content:

  • Content Ownership. With so much content already tied up through broadcast and cable network contracts, how much is actually available for a 24/7 online schedule and on-demand access?  Will the traditional networks need to be given a share of the profits?  How will that affect consumer pricing and monetization?
  • Cable’s Influence. Cable companies still hold the key to significant distribution. Will OTT and Mobile devices continue to be part of distribution agreement that Cable companies command or will we see de-coupling of Cable distribution from various IP based on demand consumption methods?
  • Awareness. Cost effective marketing strategies that raise awareness and drive viewership are critical. They can provide ‘On Demand Pure Players’ an alternative to cable deals. It will instill confidence in advertisers in terms of the potential unique reach of such programs. The next question is then how do you promote your 24/7 “network”?  Having a built-in fan base like WWE certainly helps, but content providers need to find the right mix of paid media and earned media to help drive viewership
  • Monetization. Clearly a key. What’s the best monetization approach?  Straight subscription fees?  Ad support?  A combination of the two?  And if just ad-supported, what metrics do you present to media buyers? It is important to note that innovative approaches to distribution can reduce the reliance on pricy viewership packages and top ad dollars.
  • Net Neutrality.  Streaming content networks have gotten rid of the shackles of cable, satellite and telcos, only to make way for  the Internet Service Providers.  Video streaming takes up lots of bandwidth, which can equal demand for dollars. Thus, the more net neutrality, the better for 24/7 streaming networks.  Net neutrality laws were recently thrown out in the U.S., but may soon be going into effect in Europe, so the situation is currently in flux.

The Future

The Future is about user experience and the elimination of unnecessary middlemen.

The way we live and spend our time is changing rapidly and consumers will therefore walk away from rigid content platforms that build themselves around the ‘mad men’ era of TV advertising. Consumers will shy away from a TV experiences that involve a 70’s like remote with  an 80’s like EPG.

Content will continue to change too. It is clear that more frequent consumption of shorter pieces of content is the behavior of choice. As such, quality content must maintain tight control. Admittedly, IP driven distribution channels, with the Internet being the leader, have failed to provide the right protection to content owners in many cases. We must all work to improve that. It will be critical in our ability to create commercial models that will sponsor product of great content that meets the increasingly variable tastes of consumers.

In the future, great video content will, I believe, find quick, mass distribution at a low cost and will be able to command payment, as well as receive committed ad dollars ahead of its production. Social media will play a crucial part in creating new, efficient distribution channels. We should expect to see much tighter integration between social networks and video distribution platforms.

Cable companies will be interesting to watch. The recent consolidation is a clear sign of recognition that all parts of the ecosystem in which they operate are changing. At the same time, they still amass an extremely wide audience and stand the opportunity to evolve quickly and address the “new TV consumer”.

Assuming all the above challenges are met successfully, we’re well on the road to a golden future of TV delivery.

Thanks to 24/7 streaming networks and on-demand, the future of TV will take media to a whole new level- A limitless amount of highly personalized and customized content available through thousands, not hundreds, of video channels, offering every conceivable kind of programming any consumer could want.

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