LTN – Harnessing the power of IP video distribution to drive cost efficiency and ROI
Rick Young, SVP, Head of Global Products at LTN
The media industry is changing rapidly. Fierce competition is fueled by the entry of big tech companies and digital platforms, as well as, the decline of traditional linear television viewing. It’s never been more important for Tier 1 media companies to remain laser-focused on delivering more customized content globally and increasing ROI while staying on budget. Content providers need to reassess their operational models and leverage scalable, cost-efficient video distribution solutions to overcome these challenges and maintain their competitive edge.
Today, more than ever, technology investments are assessed based on the cost savings and ROI they deliver. IP video distribution stands out as an intelligent option because it empowers traditional broadcasters, streaming players, and content owners to move from hefty capital expenditure (CapEx) infrastructure to simplified and easier-to-manage operational costs (OpEx) — while confidently harnessing new monetization and growth opportunities. Once upon a time, content was king. In this new media era, customized content is king. The players who master cost-efficient customization and distribution at scale will reign supreme.
Driving scale and growth with IP video distribution
Traditional satellite and fiber distribution used to be the methodology of choice. However, the broadcasting landscape has shifted. Media businesses are expanding beyond traditional linear television to reach diverse digital platforms, meaning that live video distribution needs to be flexible and scalable to reach any multitude of digital, OTT, and FAST platforms across all geographies. Satellite and fiber distribution models lack the flexibility, agility, and scale required to deliver multiple, customized versions of live content to global destinations.
Industry players can no longer afford to be restrained by the limitations of traditional distribution models. People are rapidly pivoting to managed, multicast-enabled IP video distribution strategies which enable greater scale and customization while drastically reducing the total cost of ownership of legacy hardware systems and infrastructure.
Maximizing the value of your content investments
Boosting ROI is top of the agenda for all media players. With skyrocketing rights fees, cumbersome production costs, and the value of traditional broadcast advertising under question — and declining 3.5% per year in the US according to eMarketer — media organizations are under pressure to make their existing investments work harder for them. IP-based video distribution unlocks critical capabilities like automated digital linear channel creation and live event versioning. Live content can be scaled and regionalized with custom graphics, language, audio, and targeted ads across platforms and geographies, reaching millions of eyeballs and creating new revenue streams. Automated channel creation and playout solutions empower content providers to spin up and manage a larger volume of linear streaming and FAST channels from a primary linear channel, delivering tailored programming for local and regional audiences.
Importantly, media companies can drive business outcomes without having to expand their master control room infrastructure or worry about resourcing limitations. IP-based video distribution scales operational teams and extends the reach of content empowering creative organizations to achieve business success cost-effectively.
Staying in control of your budget with cost predictability
Technological change, extended global macroeconomic instability, and market uncertainty mean media players are hesitant to invest in new solutions without clear and discernible paths to ROI. To rationalize their technology and business models, media organizations are moving away from CapEx to OpEx models for greater flexibility and cost-efficiency.
However, the widely accepted shift to OpEx strategies comes with challenges, especially around pricing transparency and cost predictability. Software as a service (SaaS) technology partners often offer pay-as-you-scale pricing structures that can include additional fees per ad break or per impression across digital channels. Media businesses delivering new and higher-performing offerings across FAST channels and other digital platforms might find themselves penalized with incremental costs or sharing a proportion of CPM with their technology partners for expanding their scale and driving new revenue.
This challenge is also familiar to companies leveraging public cloud with media organizations ending up splitting their tightened cloud storage budgets between fees and actual storage capacity used. Public cloud-reliant models are unsustainable — media companies need clear and transparent pricing without unexpected egress fees, vendor charges, or hard-to-predict costs.
A managed IP video distribution strategy enables media organizations to more easily stay on budget. Media companies can ensure their spending maps back to market conditions and audience demands in real time without committing to large upfront investments. Fixed-cost models deliver the cost predictability media players need to budget with confidence and scale their business without compromises.
IP video distribution as the growth factor
When it comes to increasing cost efficiency and ROI, there is no time to waste. Media companies can no longer be held back by traditional video distribution workflows created to facilitate one-to-one distribution. The costs and complexities are far too great. And while every dollar counts when tech investment is about business scale and growth, driving down costs cannot compromise business operations or mission-critical reliability.
IP video distribution equips media businesses with the agility and scalability they need to scale their content cost-effectively to more global destinations and audiences, tapping into new revenue avenues. IP-based video distribution was created for today’s media landscape and will evolve to adapt to tomorrow’s requirements. It’s a strategic business and technology investment that will not only deliver growth but will streamline and rationalize workflows, operations, and resourcing — all while providing the cost predictability that media organizations need to plan for success.
