Joseph O'Halloran | 01-08-2013
In what isn't a complete surprise given the popularity of the likes of Netflix, the pay model is set to become the dominant basis for business in the over-the-top (OTT) arena, new research has revealed.
Sponsored by content security expert Verimatrix and carried out by StreamingMedia.com, the OTT Video: Coming to a Paid Channel Near You report found that the dominance of the pay business model over free and even ad-funded models can be regarded as a very significant change of perception for the online video that was initially interpreted as a free alternative to traditional TV services.
The report also found that the number of companies involved in OTT delivery will likely grow significantly as opportunities present themselves and the proportion of those businesses substantially invested in OTT technologies will more than double over the next three years.
Despite the optimism, nearly three-fifths (59%) of respondents said broadband bandwidth limitations were currently the leading technical obstacle to OTT adoption and just over half (55%) noted quality of service and quality of experience — also related to bandwidth issues — as key gating factors. Worryingly, nearly a third did not know their strategy for managing digital rights management (DRM) across different networks and devices even though nearly half of the sample (48%) indicated that rights management was the largest single business-related issue for multiscreen service delivery.
In terms of securing their streams, just over half (53%) prefer HTTP Live Streaming (HLS) – with enhanced rights management or basic encryption – twice as many as Adobe Flash Access and Microsoft PlayReady.