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Next twelve months will be crucial for OTT opportunities

Achieving broadcast success in the Netflix age

by - John-Paul O’Sullivan, Research Analyst - S&P Global Market Intelligence

One of the key challenges for broadcasters in 2018 will be the transformation of legacy infrastructure and services to cater for new viewing habits, brought about by advances in technology and consumer connectivity. Even as legacy media companies face more competition and audience fragmentation from digital platforms providing vast video content slates, opportunities still exist for them to offer broader, more targeted distribution direct to consumers. This can be achieved through technology and content production partnerships, and understanding market demographics in particular younger viewers.

2017 was a year that SVOD services - led by Netflix and Amazon’s mass market propositions – shook up traditional TV and video dynamics. Netflix delivered strong financial results driven by popular original commissions and rapid global subscriber growth, with its members watching more than 140 million hours per day. 1 Both services now spend billions of dollars on content – Netflix earmarked $16 billion in 2017, while Amazon’s aggressive premium video push meant joining its counterpart in surpassing 50 million video subscribers in the U.S. alone, according to Kagan estimates for Q4 2017.

One of the key challenges for broadcasters’ in 2018 will be the transformation of legacy infrastructure and services to cater for new viewing habits, brought about by advances in technology and consumer connectivity. Even as legacy media companies face more competition and audience fragmentation from digital platforms providing vast video content slates, opportunities still exist for them to offer broader, more targeted distribution direct to consumers. This can be achieved through technology and content production partnerships, and understanding market demographics, in particular, younger viewers on mobile devices.

Key Trends in 2018

For broadcasters, it is important to look beyond the numbers in this period of change as tech firms grow their influence. Investment in technology and production assets provide new distribution opportunities and a stronger, more flexible content engine. These are essential tools for a digital horizon, and the broadcasters that make the smartest moves will be the ones reaping the benefits in the longer term.

Over-the-top provides content owners a means to further monetize their content, either by partnering and aggregating with video-on-demand services or launching their own direct-to-consumer offering. For example, 2018 should be the year we finally see Disney launch both an entertainment and a sport subscription service outside of a traditional pay TV bundle.

Addressable TV advertising is another major growth opportunity, as the emphasis shifts from audience volume to efficiency. Better pricing for smaller but more distinctive audiences is the name of the game. Broadcaster video-on-demand or TV Everywhere services can profit from the greater availability and more precise nature of digital data, increasing value for advertising partners and distributors.

Consolidation and convergence are the overriding industry themes with scale increasingly key to challenging the digital media giants. Multichannel service providers, digital heavyweights and major brands are driving vertical and horizontal merger and acquisition (M&A) alignment to expand into new markets and cement their competitive standing in the content space. The theme is best demonstrated by motivations behind the potential acquisition of Sky – Europe’s leading pay TV service – with offers from legacy U.S. media giants Comcast and Disney, or the merger between international programmers’ Discovery and Scripps.

Consolidation in the production sector has also rocketed, bringing with it the risk of a negative impact on creativity. In film, we continue to see a focus on building franchised titles to lower marketing and production costs due to existing fandom. There is no sign of this slowing down, which could mean less risk taking with costly script ideas, so a strong voice for the independent producers has never been more important.

Looking ahead

For broadcasters, it is important to play to its strengths. Global viewing time in terms of linear television is still strong, and broadcast delivers uncomplicated mass reach. The traditional broadcasters have an illustrious history of producing quality and memorable content, but now editorial decisions need to be made in context of a more competitive environment.

It has never been more difficult to monetize traditional TV with the emergence of SVOD players, following on from other disruptive influences in the form of time shifting, cording cutting and viewing declines in younger audiences. To ensure traditional players are not left behind they must innovative and become more agile. Broadcast heritage can only account for some much, so embracing the I.P. environment is an effective way to improve the distribution and presentation of content libraries both old and new.

JP O’Sullivan will be speaking on Tuesday the 26th of June on the company’s 2018 market outlook on the Broadcasting and media industry at ConnecTechAsia 2018.

Technology Event ConnecTechAsia Addresses Role of Accelerated

Digital Change in Asia’s Growing Economy

ConnecTechAsia, combining the strengths of industry stalwarts CommunicAsia, BroadcastAsia, and newly launched NXTAsia, is the region’s latest Mega Technology event, and will stage its inaugural edition from 26-28 June 2018, in Singapore.

With legacy events CommunicAsia and BroadcastAsia having served the telecommunications and broadcast media sectors respectively for nearly 40 years, the new NXTAsia builds upon this to bring new technologies that are shaping Asia’s increasingly innovation-driven economy. With the advent of the Industry 4.0, ConnecTechAsia will present a holistic ecosystem of infrastructure, technology, and services that businesses and governments in Asia need to thrive in this new era.

“As Asia pursues digital transformation at an accelerated pace, it is critical that the event evolves alongside the dramatic shifts happening in the spaces we serve,” said Mr Victor Wong, Project Director, UBM, organiser of ConnecTechAsia. “The new event reflects the pulse of Asia today, and is the only business platform covering the converging ecosystems of communications, broadcasting and emerging technologies connecting the physical and digital worlds.”

At NXTAsia, industry professionals will catch the newest innovations and thought-leadership in areas such as Artificial Intelligence (AI), Augmented and Virtual Reality (AR/VR), Cyber Security, IoT, Robotics, Cloud and Data among others. NXTAsia will host promising startups, and the Singapore-leg of renowned start-up competition SeedStars, at tech showcase Disrupt+.

CommunicAsia, Asia’s most established international industry event for the telecommunications sector, will focus on Network Infrastructure/FTTx, satellite communications and telecom software and services - the latest technologies to help companies and governments in Asia prepare for the coming of 5G and maintain a competitive edge in the communications and digital world.

With on-demand and streaming services surging in popularity, BroadcastAsia will shine a spotlight on the future of broadcasting, exploring how we have consumed news and entertainment over the past decade, and the challenges and opportunities this creates for traditional broadcasters and OTT players. BroadcastAsia will highlight technologies that are reshaping the value chain, such as the latest innovations in UHD/HDR, IP Broadcasting, Live Production, Content Media Security, OTT and Alternative Content Platforms.

ConnecTechAsia Summit - Digital Business Transformation

The ConnecTechAsia Summit this year centres on Digital Business Transformation, covering the hottest trends across ICT, broadcasting industries and enterprises to enable a digitalised future. The three-day summit comprises three tracks – NetworkComms, BroadcastMedia and EmergingTech – that will drive business growth and sustainability.

5G, Network Virtualisation, Satellite Communications and Network Slicing will be the main topics in the NetworkComms track, while The Future of Television, Monetisation Strategies, Social Video, IP Broadcasting, 4K, AI and Immersive technologies for broadcasting will feature in the BroadcastMedia track. Topics of the EmergingTech track will include: Artificial Intelligence/Machine Learning, Blockchain Technology, Cybersecurity, IoT, Data Analytics, Seamless Commerce/Digital Payments, Connected Industries, IoT, Augmented, Virtual and Mixed Reality, and Smart Cities.

Key speakers include:

• Professor Howard Michel, CTO, UBTech
• Jassem Nasser, Chief Strategy Officer, Thuraya Telecommunications Company
• Geert Warlop, Chief Operating Officer, TrueMoney International
• Rene Werner, Chief Customer Service & Customer Experience Officer, Celcom Axiata
• Berhad
• Leah Camilla R. Besa-Jimenez, Chief Data Privacy Officer, PLDT
• Ian Yip, Chief Technology Officer - Asia Pacific, McAfee
• Arvind Mathur, Chief Information Technology Officer, Prudential Assurance
• Bill Chang, Chief Executive Officer - Group Enterprise, Singtel
• Parminder Singh, Chief Commercial and Digital Officer, Media-corp
• Sanjay Aurora, Managing Director - Asia Pacific, Darktrace
“Presenting a holistic ecosystem of digital convergence and a platform for the discovery and understanding of new frontiers of innovation to elevate the global standing of Asian business and governments sits at the heart of what ConnecTechAsia stands for,” adds Mr Wong. “Continuing the 40 year legacy of CommunicAsia and BroadcastAsia, the new ConnecTechAsia will continue to serve Asia as we embark on the journey of the Fourth Industrial Revolution.”

Programme-at-a-Glance for Broadcast industry:
Day 1
BroadcastMedia (Commercial and Technology)
• The Future of Television
• Market Outlook on Broadcasting and Media Industry

Day 2
BroadcastMedia Commercial Track
• Monetisation Strategies
• User Experience and Engagement
• Social Video and Live Streaming
BroadcastMedia Technology Track
• IP Broadcasting
• Next-Gen Broadcasting: Enhancing Audience Engagement

Day 3
BroadcastMedia Commercial Track
• Big Data and Real-Time Analytics
• New Revenue Opportunities
• Advancing With Blockchain
BroadcastMedia Technology Track
• 4K/ Ultra HD Technology and Beyond
• The Light of Artificial Intelligence
• Immersive Technologies

Technology Tours

Broadcast Asia has also organised guided technology tours to gain insights from the industry experts.

Tour 1: HDR / UHD Workflow
To find out more about the dynamics between HDR and UHD and see how it will affect your workflow. Join the tour as exhibitors provide more insights on the solutions pertaining to HDR / UHD workflow.
Tour 2: TV Everywhere (OTT)
If you have implemented OTT services, improve your services to find out more on how you can provide personalised and customisable services to consumers by looking into data analytics. If you have yet to embark on this or are looking into it now, find out more in this dedicated tour.
Tour 3: IP Broadcasting (Video + Audio)
If you are looking at moving to IP based system, join the tour and find out more on harnessing the advantages of IP and how at the same time you can leverage on existing infrastructure investment and workflows.
Tour 4: Live Production / Sportscasting
Sportscasting has been becoming increasingly popular over the years and this will culminate in the rise of its priority and importance in live production.
Join this tour and learn the different solutions / products that enhance your production quality. Discover the different dynamics in live production and improve your reach.
Tour 5: Video Analytics
Understanding consumers’ behaviour, improvement of quality broadcasting and content are important goals for every media company. To strive to be the consumer’s top choice, explore more on how you can improve on your offerings by looking at video analytics to better suit their needs and demands.