“…[O]n the cusp of the next major evolutionary growth phase…”
If you draw a circle which contains all things entertainment and a second which contains all things technology, the area where those things overlap (the venerable and oft-used Venn diagram) would be the NAB Show, just now wrapping up in Las Vegas.
Reports from the Giants who attended this annual Las Vegas event tell of a huge increase in activity and interest in Over-the-Top initiatives. OTT seemed to be the subject of about 50% of the conversations had on the floor, if anecdotal evidence is to be trusted. Indeed, it’s not hard to believe that OTT and online video was on the tip of everyone’s tongue.
There’s been plenty going on in the OTT space leading up to and during the convention:
- Launch of SlingTV – While many say this foreshadows the end of broadcast TV as we know it, there are still some kinks to work out.
- Launch of HBO Now — While access to this new service is a bit restricted to those willing to hook up a laptop to their TV via HDMI, through iOS device, the numbers for just the first week of service are pretty impressive for such a new service.
- The impending announcement of the new Apple TV service. Key among these announcement is the news that Apple is voluntarily taking a cut in the required revenue share in order to attract new partners.
- Reports of US OTT utilization is up, Up, UP! — As reported Home Media Magazine, “About 57% of consumers in U.S. broadband households subscribe to an OTT video service, such as Netflix or Hulu Plus, according to new research from Parks Associates…Indeed, with the recent launch of HBO Now and subsequent access on Sling TV in time for the April 12 bow of the fifth season of HBO’s “Game of Thrones,” SVOD use is only expected to surge. Consumer uptake of OTT video is expected reach 100 million this year, with a further 77 million more expected by 2019, according to research firm Ovum.”
With such powerful brands leading the way, it’s not hard to see the direction we can expect from the rest of industry, and most importantly, consumers.
There’s no question that Americans and audiences the world over are shifting their viewing behavior toward OTT (non-linear) TV. The explosive growth of the past five years, which has taken OTT from $0 to $51B globally, is expected to continue on a similar trajectory, lead by the US and the Asia/Pacific region.
It’s a revolution in the way we consumer entertainment, without a doubt:
“We are on the cusp of the next major evolutionary growth phase in visual entertainment,” added Ed Barton, Ovum’s head of TV research and analysis. “As the industry hunts for opportunities to address slowing traditional TV subscription revenues, the major trends in technology, audience consumption, and service evolution offer glimpses of a brighter future. We see a shift in how TV is increasingly addressing individuals rather than households, and how the merging of online and broadcast advertising technologies and the on-going hunger for true ‘Martini TV’ – any time, any place, anywhere – from the audience offers significant incremental revenue opportunities. The proliferation of linear SVOD from traditional TV is just one part of this shift which underpins our firmly held view: TV’s best days lie ahead.”