Broadcasters to take control of OTT in 2013
Editor | 08-01-2013
Far from being the thing that destroys their revenue base, over-the-top services will actually benefit broadcasters who will likely come to dominate pure play rivals in 2013, asserts a research note from Deloitte.
Indeed the industry analyst predicts that in markets where such services are available, two-thirds of the top OTT TV programme and film services are likely to be those provided by existing broadcasters.
That is to say that for the majority of households, and thus for the mainstay of business, OTT is likely to be offered as part of the ecosystem of television services provided by either pay-TV companies or free-to-air broadcasters with its principal role likely to be to enable catch-up, rather than to create a bespoke 'channel' of TV content.
Moreover, Deloitte believes that even though pure play OTT providers and OTT divisions of larger companies that are not in the TV industry should enjoy growing market share and usage, in most markets their active paying subscriber base is likely to be under a tenth of households.
Deloitte also predicts a market dynamic where free-to-air TV broadcasters are likely to offer OTT for free, and pay-TV companies will include OTT access as part of subscription packages. In all it calculates that total global revenues from TV advertising and subscriptions are likely to reach about $400 billion in 2013 yet with combined OTT revenues for existing broadcasters and pure plays likely to be less than 2% of earnings, derived from subscriptions and advertising.
Deloitte's expectation is that even in markets with extensive broadband roll-out, on-demand TV and movies will largely represent only a few percentage points of total viewing, whether this is via broadcasters' pay-TV companies or pure play OTT provider sites. It also believes that official on-demand TV and movies sites will likely represent only a few percentage points of total online video.
Brand and content are set to emerge as the two aces in the hand for legacy broadcasters' OTT services as most viewers will likely to remain faithful to the broadcasters and programmes they have watched in previous years. Yet, warns Deloitte, this will only be as long as those broadcasters continue to provide the type, quality and quantity of programmes that viewers like. Furthermore, Deloitte believes that in the main viewers will likely remain averse to new sources of content throughout 2013.
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