Global OTT surge prompts multichannel distribution opportunities, challenges

December 18, 2013 - 5:33pm
Smartphones will continue to be drivers of OTT video and multichannel distribution requirements.

As adoption of over-the-top (OTT) devices continues around the globe, the technology has the potential to drive a new era of video transport. Network engineers will increasingly have to contend with the realities of multichannel distribution, while broadcasters and cable providers will continue to improve interactivity, advertising potential and the delivery of a personalized viewing experience.

Sales of OTT viewing devices topped $8 billion in 2012 and are expected to continue that upward trend in 2013, according to Easier Technology, surpassing $20 billion by 2015. While the North America market has received the most attention since it produces such a large percentage of televised content, the markets in Europe and Asia-Pacific also experienced more than 50 percent year-over-year growth from 2012. More than 1.7 billion OTT devices are expected to be shipped in 2013, according to IHS, a 20 percent jump from 2012 unit shipments.

"Content owners, operators and consumers all are driving the proliferation of the OTT model. Content owners want to expand the market for the films, music and videos they own," sated IHS senior principal analyst Jordan Selburn. "Meanwhile, operators wish to use OTT in order to add value to their services and keep subscribers from cancelling TV subscriptions in favor of purely broadband connections - preventing what the industry calls 'cutting the cord.' Consumers, for their part, desire access to a wide variety of media at the time and place of their own choosing."

Worldwide OTT growth projected
In Spain, one OTT service achieved more than 100,000 subscribers only three months after it hit the market, Advanced Television reported. Interestingly, it's estimated that about 80 percent of the service's subscribers utilize it through their regular TV screen. Many early adopters of OTT services have retained their regular pay TV subscriptions as well in order to enhance their total viewing options.

Investment in video transport architecture that can facilitate OTT delivery in addition to pay TV connections will be essential to tapping the rising OTT market. According the IHS, several technological developments, such as high-efficiency video codecs (HEVC), will make it imperative for broadcast system engineers to reduce bandwidth reliance and potential sources of sluggishness in video delivery systems.

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