Original Article: https://fxdigital.uk/the-future-of-ott-connected-tv/
The pandemic saw swathes of the global population confined to their homes leading to an unprecedented spike in content consumption that has accelerated the future of Over-The-Top (OTT) streaming services and Connected TV as we know it.
With OTT and Connected TV users hungrier for content than ever before, brands have been fiercely competing within the increasingly competitive market to deliver more for users, with 2020 being the year that reshaped the future of OTT and CTV for good.
Innovation: Giving users what they want
In recent years, the OTT and Connected TV space has grown rapidly, more recently accelerated by the impact of COVID-19. With the acceleration of the market, the demand for quality content and feature-rich applications is increasing, meaning brands need to innovate to keep their users coming back for more.
In Q3 of 2020, it is reported that the proportion of UK homes with access to a Subscription Video on Demand (SVOD) service grew to 61.9%, passing 17.5 million for the first time. With over 17 million users having access to SVOD platforms, users are beginning to suffer from “subscription fatigue” or “the potential tiring of consumers of signing up for an increasing number of subscription businesses”.
To combat this, brands must take into consideration the fact that they must be unique within this market and set themselves apart from the rest, and this can be done through innovation. Subscription businesses that want to see success in the coming years need to remember that they will be fighting for priority. This means the more unique or needs-based a subscription service is, the more likely it will be to make it onto consumers’ shortlists in the future.
Due to the OTT and Connected TV space becoming more competitive, brands are having to introduce new features to not only attract new users but also retain existing users. Recently, BT Sport introduced their new ‘Watch Together’ feature, which allows customers using the award-winning BT Sport app on mobile devices to watch, see and chat with friends in a split-screen view while streaming BT Sport channels. This is a great example of giving people more and staying ahead of the game, allowing BT Sport to stand out from other big players in the market through their new in-app feature.
When considering the future of OTT and Connected TV, as well as giving people more, it’s also important to note that the overall UI (User Interface) and UX (User Experience) of a Connected TV app will play an important part within this space in years to come, as users are more inclined to get rid of the apps that don’t satisfy their needs, making the look, feel and features of a TV application of paramount importance when trying to attract and retain users. We will no doubt see more and more users opting for OTT platforms that satisfy their needs in terms of overall UX through a compelling and engaging UI, and getting rid of those that don’t.
Cord-cutting and the rise of Connected TV
With the OTT and Connected TV space growing at a rapid rate as a result of the pandemic, we also saw a rise in the number of ‘cord-cutters’. ‘Cord-cutters’ are defined as “a person who switches from a pay TV subscription (cable, satellite or telephone company) to an Internet-based streaming service such as Netflix”.
As more and more people are discovering that you can consume content on your TV at a lower cost without the need for a cable subscription, many more are deciding to cut the cord, with the number of ‘cord-cutters’ in the U.S. expected to increase to 55 million by 2022.
With the number of ‘cord-cutters’ rising year-on-year, the demise of cable TV has certainly accelerated and will continue to do so in the coming years, meaning we could soon see the majority of households cutting the cord for good, resulting in big players like Sky TV and Virgin Media TV losing their footing in the market.
The NFL has already harnessed the power of D2C with their global Gamepass App allowing them to further monetise their content in a branded NFL app alongside broadcasting through traditional platforms. In the UK, the English Football League currently broadcasts games on a PPV basis through their ifollow platform, might we see the Premier League go the same way?
In the future, we can also expect to see many smaller brands take advantage of the OTT and Connected TV space which was once ruled by “tier one” media and entertainment brands, as new, innovative solutions continue to make the TV landscape less fragmented, making developing a TV app more affordable for smaller brands to break into the market and serve more niche interests.
Mobile vs Connected TV: Who will win in the end?
One of the many benefits of OTT is that users can access content from all sorts of devices such as mobiles, tablets, laptops, Smart TVs, Set-Top Boxes and gaming consoles and this is something that a large proportion of subscribers take advantage of when on the go.
However, as the pandemic struck and users retreated to their homes, we have undoubtedly been reminded of the demand for Connected TV and providing users with TV applications via the “10-foot experience” is an integral part of any OTT strategy.
Looking towards the future, not only is a multi-device strategy essential to competing with other brands in this space, but it’s also a key factor in retaining those all-important users. Therefore, OTT providers must deliver consistent experiences across a wide range of devices, and this is something we are already seeing from the likes of Netflix and Amazon Prime for example.
With the rise of 5g, it is apparent that this network will play a huge role in enhancing the mobile experience for users as it becomes even easier to consume content on the go. The bigger picture means that demand for both Mobile and Connected TV is here to stay. Both short-form, which tends to be enjoyed more on mobile, and long-form content generally consumed through Connected TV, could become complementary as opposed to mutually exclusive, as apps that have a multi-device strategy and deploy across both can integrate seamlessly for a pleasurable user experience (UX).
Conclusion: Watch this space
With a staggering 1.1 billion Connected TV devices in use around the world and with the OTT market expected to reach $194 billion by 2025, it’s evident that the future of TV lies with OTT and Connected TV.
The last 12 months has accelerated an already growing industry, seeing more of us cut the cord than ever before and this could signal big changes in the future of both traditional and digital broadcasting. However, as the market becomes more crowded, brands will see an increase in competition with more companies attempting to break into the OTT and CTV space, enticed by lower barriers to entry and the promise of big rewards.
Within this new TV revolution, brands must stay ahead of the game in the years to come as users are demanding more and more, and this is something which brands must deliver on to ensure they are retaining their existing users and providing them with an experience that trumps the rest.