The Week That Was…And Wasn’t

April 28, 2015

From the disagreements between ESPN and Verizon, to the left-at-the-altar marriage between Comcast and Time Warner Cable, it was a huge week in OTT.

Verizon created a flurry of interest in its new, mobile-only sports offering, for which it had apparently signed up the leading providers, including ESPN.  But not so fast – ESPN first noted publicly that the envisioned unbundling wasn’t contractually agreed upon.  When that wasn’t enough, they filed suit.  In a world growing ever more complicated, as content becomes available through a myriad selection of devices and platforms, this will doubtless not be the last disagreement between content owners and operators over what is, and is not, permitted.

Meanwhile, the long-discussed and disputed marriage between Comcast and Time Warner Cable was declared over.  Consumer groups were concerned about concentration of control – though less of Pay TV, and more of broadband provision. There is plenty of blame being bruited about – and assigned – but this was probably foreseeable for some time: according to Al Franken this was driven by ‘the power of grass roots activism’. Whatever the specifics, it would seem that each will return to their corners, re-consider their strategy, and come out swinging at the next deal. While it’s a PR black eye, we can still expect to see these behemoths of broadcast leading the way into the TV future.

 It was also a great week for analysis and reports.  The 2015 Viewer Experience Report from Conviva was released, showing the continued impact of interruptions on consumers and the variability of service available to consumers.  Meanwhile, Accenture offered their Pulse of Media overview, which shows how consumers are becoming frustrated at Internet TV that doesn’t meet Pay TV levels of quality of experience; and their Digital Video and The Connected Consumer report, which not only confirms consumers’ demands for high quality of experience, but also reveals (see page 9) that current Pay TV providers still have an advantage in delivering even in the age of OTT.

Predictions of the future size of the OTT market continue to proliferate faster even than Android versions.  RCR Wireless predicted nearly a billion dollars in LatAm by 2018, while Juniper Research projected $32B in total worldwide revenues by 2019. Whoever is right – and the numbers just keep growing – any question of whether this is a real business have been put to rest.

Meanwhile, the impact of different viewing devices is coming into clear focus: MediaPost suggested that connected devices are changing the way consumers watch, and the BBC embarked upon its mission to be internet-first.  ITWire suggested that the pure-play OTT services could take a bite out of traditional providers. True as this may be, don’t count out the established players, as we continue to see big successes like Sky announcing its largest subscriber growth in 11 years. As Videonuze reminds us, it remains unclear whether the different factions of the OTT revolution are friends or foes.

Maybe BrandChannel is right that the mobile phone has become our primary screen. But it remains a reality that the most valuable customers are those using a full-sized TV in the living room; and for as long as that’s the case, up-screening consumers from their iPhone to their television will be at the heart of any strategy.