On September 5, 1995, a Major League Baseball game between the New York Yankees and the Seattle Mariners was broadcasted live over the internet. It was the world’s very first live streamed event and was done using cutting-edge technology developed by a Seattle-based company called Progressive Networks. But this was more than just a ball game. What it meant was that anyone in the world, whether they lived in Tennessee or Tokyo, could watch a ball-by-ball play, in real time, as long as they had an internet connection.

A few years later, after Progressive Networks rebranded to RealNetworks, it found itself entangled in a bitter legal and technological battle with Microsoft for control over what would be the next big thing in the broadcasting space – streaming media. Streaming media had long fascinated tech aficionados and CEOs but its early years were marred by quality issues around simultaneous video playback across thousands of modem lines. Since the user experience was terrible, it didn’t really generate the kind of buzz among consumers that was expected.  

Back then, another evolution was underfoot – the shift in customer preference towards personal screens. Industry soothsayers noted that consumers were starting to prefer personalization in the content they consumed. Sure, there were barriers that prevented mass consumption and monetization for content distributors, namely around ease-of-use, but it’s potential was becoming increasingly clear.

The seed that was sown by a handful of Californian startups was soon followed by a few select networks, but progress was slow. The old hurdle of user experience was still a major deterrent.  And most traditional players paid no attention. After all, why would someone ever give up the comfort of digital cable for a patchy, unreliable, and hard to use feed?

How wrong they were.

Fast forward to 2019. Over-The-Top (OTT) content consumption is everywhere, from live sporting events to movies to the news. OTT content platforms offer users a superlative experience and complete service personalization, which lets them consume the content of their choice, when they want, across a range of smart devices and platforms. Traditional content distribution platforms like cable and broadcast are having sleepless nights because they are simply unable to match up. Can you blame them?

Establishing Dominance in a Crowded Space

A recent report from Digital TV Research reveals that the global OTT revenue will reach a staggering USD 129 billion by 2023. Traditional players know they need to catch up or risk missing out. But that doesn’t have to mean taking down behemoths like Netflix or Amazon Prime. The market is huge, and with a smart strategy and the right tools, there’s plenty of pie to go around.

So if you’re looking to jump on the OTT bandwagon, here’s list of essentials and OTT-must haves:  

USER EXPERIENCE:

The winners in today’s media marketplace have one thing in common: great user experience. And delivering a great user experience begins with acquiring user insights. User insights help deliver a personalized user experience coupled with a unique service value proposition. So as a content creator and service provider, do invest the time and effort required to learn, and then implement global best practices of the OTT industry. Use advanced tools to learn about the type of content your consumers prefer, use their preferences over time to build a smart recommendation engine, so their experience using your platform is intuitive and predictive. Ensure that your UI/UX is top notch to facilitate ease-of-use. Remember, great UX in OTT depends on several aspects such as targeted retention strategies, tailored recommendations, quick onboarding and convenient payment gateways. Ticking all these checkboxes will help you score high on what is arguably the most important competitive differentiator across industries: user experience.

Quality of Experience (QoE)

Here are the four QoE metrics to monitor OTT service performance:

• Rebuffering Ratio
• Video Startup Time
• Video Quality and Bitrate Calibration
• Video Start Failures

Successful OTT service always begins with a higher QoE. Picture this. You download a new OTT app –you are dazzled by the beautiful UI/UX it has and you dive right in to a show that you’ve wanted binge watch for long. But alas, you encounter an ugly black screen with a buffer circle that seems to revolve forever. Fast forward 10 seconds and the episode begins to stream only to pause after a while with the ugly circle retuning to haunt you.

Would you ever spend time on such an OTT platform, regardless of how great the content and UI/UX is?

QoE, for today’s consumers is more important than anything else.  To ensure that your customers receive the best QoE from their OTT service, check if your native service platform has a robust backend CMS (Content Management system) working in parallel with a smart client-end application. This can prevent critical service delivery failures. Also, by implementing adaptive bit rate technology, you can calibrate the quality of video streams on a user’s device in real time without losing sync, even if your user’s internet connection is poor.

CONTENT IS KING:

Your OTT platform is only as attractive as the content it offers. Make sure that your content catalog offers the kind of content, across genres that users today seem to flock to. Then target your audience based on their content preferences. Once you know what your users choose time and again, you’ll be better positioned to formulate a robust content strategy, provide relevant content suggestions, strengthen the delivery mechanism, and ramp up your monetization strategy.  

According to Digital TV Europe’s 2018 annual survey, 62.9% of respondents say that the original content is the most compelling reason to sign up to an OTT service in the first place.

According to Netflix CFO David Wells, the company spend upwards of USD 8 billion in 2018 and planned to launch 700 originals worldwide this year. He added that originals played an intrinsic role in increasing Netflix’s subscriber base.

Another great way to quickly popularize OTT service is to provide a live TV feed which quadruples users’ concurrent viewership during live sports events. This can help boost revenues when bundled with other subscription models.

Here are a few things to consider while creating a smart content strategy:

MONETIZATION: 

You will be amazed to know how many content providers have burned their fingers because of the wrong monetization strategy. In fact, market leaders such as Netflix have also faced the brunt of growing content licensing costs due to aggressive bidding. Given this scenario, it’s critical to identify and adopt the right monetization model that can serve as a steady, long-term source of business revenue.

The following are the subscription models for monetizing content:

• Subscription-free
• AVOD – Ad-based Video on Demand
• SVOD – Subscription-based Video on Demand
• TVOD – Transactional-based Video on Demand

AVOD and SVOD are the two most commonly used monetization models these days. But do bear in mind that:

• AVOD is a better option when there’s no established user base and the content is too diversified
• SVOD serves as a safe bet when there’s original content and Live TV services

Another option is the hybrid monetization approach, which combines free to watch, ad-supported, subscription, and transactional monetization methods. It’s a flexible monetization model that lets you maximize revenue and scale your business.

DEVICES and PLATFORMS:

A lot of OTT rookies start off too ambitious. They want their application to seamlessly run on every single device and platform. There are numerous types of devices and platforms available in the market that help users access OTT content. Perfecting the overall experience on each requires time and investment.  

The key is to prioritize and understand the strengths and limitations of each streaming screen to deliver a high quality video experience to consumers. If you are eager to speed up service deployment across various devices and platforms, then you should definitely consider going with a customized OTT framework. That way you can also cut down on the time and cost that would otherwise go into the development of new OTT application from scratch.

CDN (Content Delivery Network):

One thing that overwhelms a lot of OTT beginners is CDN. They hear about the exorbitant costs involved in investing in a CDN. Some even try their hands at building their own CDN which often takes months or even years to see the light of the day.

Things don’t essentially have to be that way. There are so many flexible options available in the market to match your budget, customer requirements and need to scale. You just need to choose the right Content Delivery Network (CDN). For a dedicated CDN service, the cost is typically based on the size of the data packets delivered to users and bandwidth peak parameters. Your OTT content distribution strategy should be perfectly aligned with the right CDN services which can accommodate both current and future content delivery needs. Most CDN providers have the flexibility to offer annual service contracts. So go with short-term service contracts to accommodate changing cost models which might change in the future. 

CONCURRENT USERS

Die hard sports fans can be unforgiving if a feed disappears or is disturbed during an important game. Live sports OTT requires both ultra-low latency and redundant data feeds. In order to provide maximum quality of experience (QoE) you have to constantly monitor the network with a robust test automation engine. Such an engine can help you identify service failures and run the root cause analysis to rectify critical problems. Also ensure that the content delivery is executed from state-of-the-art data centers that host a large network of data servers.

The Cisco Visual Networking Index estimated that live internet video will account for 13% of all internet video traffic by 2021, growing 15-fold from 2016 to 2021. This means, in a span of just 2 years, close to 30 million terabytes of live video will pass over the internet every month.

SECURITY:

Security is two-fold: authenticated users and security of content deployed through the platform. Piracy can result in massive losses. Research reveals that revenue losses incurred from streaming piracy is expected to reach a whopping USD 51.6 billion by 2022.  

In order to build a robust security system on your OTT platform, you need to identify the right Digital Rights Management (DRM) solution suitable for your service delivery framework. You also need to determine whether your platform will need multi-DRM integration and figure out if such integrations will comply with backend systems, the client-end application, distribution channels, and all enabled devices. Any loophole in your security systems can put your OTT service delivery at risk.

Lastly, in addition to securing your content stack, you also need to safeguard the customer information embedded in backend and frontend systems. Tokens, digital watermarking, and Hypertext Transfer Protocols (HTTPs) are some of the most powerful mechanisms that can help you control unauthenticated user access and data theft during streaming sessions.

Quality of Service (QoS):

For long-term success in the OTT business, aim for a high rank on the quality of service (QoS) index. Some major factors impacting quality of service are:

• Irrelevant advertising
• Long buffer time
• Poor video quality
• App crashing

Pay keen attention to service quality details to ensure that the points above never occur. Proactively monitor your systems to track down potential issues across critical touchpoints in the service delivery framework. Identify potential threat vectors that can deteriorate the QoS and QoE.

Then, empower your OTT systems with a robust Test Automation Engine which works in unison with the OTT system and seamlessly identifies service glitches such as audio/video freezing and looping, playback jitters, app crashing, packet dropping, network failures, rebuffering, latency and so on.

IMMERSIVE ENTERTAINMENT:

As with all strong businesses, keep an eye on the future. Just as OTT platforms are poised for a takeover, new, immersive formats like VR gaming and 360 degree video with customizable viewing and advanced voice and gesture controlled features, will be the next threshold of entertainment. Stay ahead of the curve by preparing for them. Engaging and immersive content translates to increased user engagement which in turn, can boost your subscriber base, enhance your brand name, and drive up revenue.

For sure, integrating advanced video feeds won’t be a cakewalk. You will need to transform and dramatically upgrade your OTT set up in terms of storage space, CDN bandwidth, processing speed, delivery mechanism. But the payoff might be worth it, and the change can be made in incremental, cautious, well thought-out steps. Above all, keep your ear to the ground and be on the lookout for changing trends. Because the future belongs to first movers and bold decision-makers.