Hybrid TV goes mainstream

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Dan Finch, Simplestream
Opinion
February 16th 2017 at 10:32AM : By

Dan Finch, commercial director of Simplestream,

As the Internet started making its way into homes nearly 30 years ago, it quickly allowed users to become accustomed to more control over when and how they could access content. Remember the WAP days? They were limited to messages and browser-based news items, but you could stll play Snake! It was only ten years ago though, when video really started to take off online, which heralded a significant change ahead. And the question of what the new technology might mean for TV channels?

Delivering content over IP has been around for a long time. Remember Homechoice? The impact of moving from closed traditional networks (IPTV) to the open internet (OTT) has, however, changed the face of video consumption forever. If you own the rights, then there are no more barriers, and if you control the technology, then you can curate and promote content based on powerful algorithms – keep an eye on Facebook!

The internet has quickly become a bottomless vault of content that consumers can flexibly access on their own terms – something traditional linear broadcast television can’t really compete with, except of course by using OTT to “go hybrid”. The networks that once held a monopoly over consumer viewing habits have been out-innovated by some industry players, and those that haven’t started to do so yet need to adapt quickly.

Largely driven by the likes of Netflix and Amazon Prime, the rise of OTT has prompted another wave of content culture change. Prompted by a massive proliferation of connected devices at our finger tips, the prominence of multiscreen delivery and subsequent device shifting – largely driven by millennials – makes it hard to deny the impact OTT is having on the viewing experience. The numbers speak for themselves:

  • More than a quarter of British adult consumers subscribe to a video streaming service like Netflix and Amazon Video
  • Twelve percent of the UK adult population no longer watch broadcast TV, and that number increases to 58% when looking solely at millennials
  • Although American consumers are spending 45% more time choosing what to watch on VOD compared with scheduled linear services, their satisfaction with VOD ranks higher 
  • The global VOD market is projected to be valued at $90.8 billion by 2020
  • The percentage of 18-34 year olds that regard the household TV as their primary entertainment medium has dropped nearly 50% since 2011
  • 70% of online adults and 87% of 16-34 year olds use smartphones, tablets, game consoles, e-books, laptops or other connected devices while watching TV 

With this growth and momentum, the day that OTT video streaming reaches the billions may very well be around the corner – and thankfully for broadcasters, there is a great new way to phase the transition to IP-based services.

A few companies now offer a wide range of end-to-end solutions for broadcasters wanting to reach “traditional” audiences via hybrid set top boxes for Youview, Freeview Play, Freesat and EE. These platforms now offer many of the great benefits of OTT, including deep-linked access to catch-up content and advanced content discovery from the familiar environment of a set-top-box under your TV.

Furthermore, once such services are launched, building upon them to launch on the more nascent platforms like iOS, Android, Amazon Fire, TVOS and Roku is no trouble at all with a modular solution.

Linear television won’t be falling off a cliff anytime soon, and the tipping point is not quite there, but there is an important and timely opportunity for media owners to react to this culture change and figure out what it means for them, hopefully without breaking the budget.