Rise of OTT

November 21, 2020

Rise of OTT

In these lockdown period, one of the most trending term is “OTT”. Peoples were spent their time by watching movies and series through OTT platform.

What is OTT?

OTT (Over The Top) is a streaming platform services across different devices. It offered directly to viewers via the Internet. It bypasses cable, broadcast and satellite television platforms, the companies that traditionally act as a controller or distributor of such content. The term is most synonyms with subscription based video-on-demand services that offers access to film and television content.

How OTT differs from video?

Video content can be viewed across any devices, including computer, laptop, mobiles, television and also OTT platforms etc. But the OTT content is made available by an OTT content provider (like Sling TV). No matter that, this content can also be streamed across any devices.

History of OTT:

The world’s first OTT service was initiated by Netflix. Netflix started in 1997 to disrupt the market leader of renting DVDs/video tapes which rented via email. In 1999, Netflix announces its new model of subscription model, $15.95 per month, which allowed Netflix members to rent up to four movies at a time, with no-return by dates. In 2000, Netflix abandoned late fees and return by dates in favor of monthly subscription plan priced at $19.95 per month. In 2007, they expanded its business with introduction of streaming service, while retaining its mail-order rental service.

In September 2006, Amazon launched Amazon unbox in the US, the service grew with an expanded library, and added the Prime Video membership upon the development of the Prime Subscription. On April 2016, Amazon split Prime Video from Amazon Prime in the US for $8.99 per month. On the same year of December, Prime Video launched worldwide except for Mainland China, Cuba, Iran, North Korea, Syria) expanding its reach beyond the United States, and other countries like UK, Austria.

A number of OTT platforms are entered in India since 2008. The first OTT platform in India was BIGFlix, by Reliance Entertainment in 2008. In 2010, Digivive launched India’s first OTT mobile app called nexGTv , which provided access for both live TV and on-demand content. OTT gained significant momentum in India when both DittoTv and SonyLiv was launched in the Indian market around 2013. Hotstar followed in 2015, which is the most subscribed OTT platform in India at present. Netflix entered India in January 2016.

Behind OTT:

In broadcasting, over-the-top content is the audio, video, and other media content delivered over the Internet, without the involvement of a multiple system operator (MSO) in the control of distribution of the content. The Internet provider may be aware of the contents of the Internet Protocol packets but is not responsible for, nor able to control, the viewing abilities, copyrights and/or other redistribution of the content. This model contrasts with the purchasing or rental of video or audio content from an Internet Service Provider, such as pay television, video on demand, and from internet protocol television (IPTV).

Accessibility:

· Mobile OTT Devices: Smartphones and tablets are able to download OTT apps to stream on the go.
· PC devices: Consumers can access OTT content from desktop based apps or web browsers.
Smart TVs: The most common examples include Apple TV’s, Smart TV’s, Xbox and more.

Revenue Models of OTT:

Today, OTT has become a dominant channel for video consumption alongside PayTV and traditional broadcast services. With a 28% Year on year growth in total time spent streaming on OTT, the media revenue is expected to reach 158.84 billion dollars by 2024, more than double the 67.8 billion generated in 2018. Primarily, there are three factors should determine the model that you should choose for your business.

The Content Offered.
The Target Group
Your Business Strategy

There are few revenue models which are available to OTT companies are listed below.

AVOD: stands for Advertising Video on Demand. In this model, streaming video is delivered as a free service for end customers. It offers powerful advantages for businesses because of its free nature. Advertisements are the economic engine for businesses that operate under this model. Such ads are placed at beginning, middle, and the end of the video. There is no charge for accessing the video content. YouTube is the best example for AVOD model. Other examples are, Yahoo Screen, FilmOnX, AOL On, Dailymotion.
TVOD: stands for Transactional Video on Demand, is quite straight forward. It businesses charge users for every single watch, every single time, also called as Pay per View model. The unique selling Proposition of this model is immediacy. Consumers can access, by renting or buying movie and TV series much sooner after their general release on a TV broadcast. ZeePlex is the best example of this model.
SVOD: stands for Subscription Video on Demand, which are the clear favorites among consumers. It offers its users to access entire library of video content by simply signing up for the subscription. It is estimated that 3 in 4 US households have an SVOD service. More than 64% of adults in the US report using SVOD services monthly. Netflix, Amazon Prime are in this model.
Hybrid model: It combines the best of world by the bundling the services in different ways. An example of how might work out is when the user is sign up, he is provided with a library of content. The user can choose to opt in for a paid pack to excess certain exclusive content. This paid pack can be either in Subscription or the Pay per view model. Hotstar, ZEE5 are some examples of Hybrid model.
Multi-Screen model: allows OTT providers to their customers to access the streaming content on multiple devices so that they can watch anytime, anywhere.

Benefits of OTT:

OTT opened up the possibility for ad-free content, ad-hoc subscription, and more monetization strategies. With the freedom of going “On the Air” whenever, viewers aren’t regimented to what’s broadcasting at the moment. Consumers are getting to be in the driver’s seat. More than ever, content is going straight toward what the consumers want to watch and the turnaround time is getting faster and faster.