Audiences today are embracing the new age of media as more consumers shift away from traditional linear viewing and towards streaming video subscriptions.
According to recent research, many viewers are opting to cancel their traditional cable or satellite TV subscriptions, commonly called “cord-cutting”, in favor of OTT services. In fact, in July of this year, traditional broadcast and cable made up less than 50 percent of TV usage, a tipping point we see accelerating in coming years.
With over 25 years’ industry experience across media and telecommunications, Daniel Graham is VP of Product & Partnerships at Edgio where he oversees the entire product lifecycle of media and streaming services, from ideation to execution.
This trend away from traditional TV viewership is reflected in the predictions from S&P Global anticipate overall streaming subscription and advertising revenues to leap from $2 billion in 2010 to $100 billion by 2026. While achieving broadcast-quality was the primary goal a few years ago, streaming platforms have long since achieved that milestone.
Today’s challenge lies in meeting ever-evolving audience expectations: lean-back experiences at high quality, compelling price points , and tailored advertising content and recommendations.
Media organizations are in a transitional phase right now, working to cater to their audience in new creative ways amidst economic headwinds.
Today, the spotlight is on experimenting with different service tiers, new viewing experiences, and exploring the business models that support them.
Offer curated television experiences that are both high in quality and competitively priced. Leaders in the media space are acutely aware of the need to deliver multiple viewing models such as SVOD, AVOD, and FAST while maximizing ad revenue and reducing their operational costs.
While streaming complexity continues to grow, content providers that embrace forward-thinking technology partnerships to simplify a fragmented landscape and drive profits can stay ahead of the curve.
Evolving business models drive complexity
The era of a one-size-fits-all streaming model with one form of subscription to access one form of content, is long behind us.
Audiences are now much more nuanced in both their viewing preferences and available budgets, and need the flexiblity of choice from their streaming providers . As a result, interest in cheaper alternatives such as free ad-supported TV (FAST) is surging, with Omdia projecting the revenue from Free Ad-Supported TV (FAST) to triple, hitting the $12bn mark by 2027.
To remain relevant and competitive, SVOD platforms must diversify their offerings to capture audiences with varied budgets and tastes, and these principles could soon make their way to live streaming and premium sports scenarios too
Furthermore, macro- trends in, regions such as Asia and Africa are compelling providers to roll out more affordable mobile-centric packages, for example. Media companies need to find the right mix of distribution strategies and service tiers to foster subscriber loyalty and growth while maximizing ad revenues.
However, providing high-quality content to viewers across different subscription types, viewing formats, and digital platforms is no small task and causes huge complexity for media companies — and increased costs.
Providing this level of flexibility at a global scale is even more challenging, placing growing demands on video technology workflows and operational resources.
Technology foundations for tailored monetization
Experimentation with innovative distribution models such as FAST adds another layer of complexity to the already pressured streaming ecosystem.
Streaming companies are already grappling with rising content costs, intense competition for licensing rights, and rapidly evolving viewer habits. Factor in the technology infrastructure required to support these operations, and the scale of the challenge becomes evident.
Last year’s FIFA World Cup final drew over 21 million concurrent streamers. Viewers for these kinds of major live events are not only spread across viewing platforms, from Smart TVs and desktops to on the go via mobile devices, but they are also becoming increasingly segmented across different subscription types, from premium quality tiers and regular subscriptions to ad-based alternatives.
This means each stream needs to be tailored based on device, geographic location, and bandwidth to deliver optimal quality and personalized advertising. Tailoring the content monetization of individualized streams enables media companies to significantly enhance their revenue generation and maximize profitability.
In a fragmented OTT landscape, getting closer to your audience is paramount — but meeting consumers anywhere and everywhere requires highly scalable and flexible streaming workflows.
As content providers sail the turbulent waters of the evolving streaming market, resilient technology, and reliable partnerships will be key to overcoming complexity and driving ROI.
Daniel Graham is VP of Product & Partnerships at Edgio where he oversees the entire product lifecycle of media and streaming services, from ideation to execution. Daniel is a technical product executive with over 25 years of experience defining and executing data-driven product strategies by leading high-performance teams to deliver enterprise and consumer products and services for web, mobile, and connected TV experiences.