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A crowded OTT market means opportunity ahead for telcos

Kamal Bhadada, president, CMI, Tata Consultancy Services, explores potential value for telco businesses

The media industry is undergoing an unprecedented period of change. Consumers are cord-cutting expensive pay-TV and switching to streaming services like Amazon Prime and Netflix, which boast flexible packages with no termination fees. According to Ofcom, the number of subscribers of streaming platforms overtook the number of people with traditional satellite and cable services in the UK for the first time in 2018.

Established content creators, studios and broadcasters who previously sold content through distribution channels are now going direct to consumer, offering their own streaming to stop the haemorrhage of cord-cutting. Newer entrants to the market such as Apple and Disney are battling more established players like Sky, BBC and HBO, making for an increasingly crowded online streaming market.

In the world of telecoms, all these businesses are called OTT, or ‘over the top’ platforms, because their service literally sits on top of the high-speed internet infrastructure provided by telcos. Telco businesses are facing their own challenges, with many anticipating high capital expenditures to modernise their networks. However, there are huge opportunities here. Telcos have the chance to monetise their infrastructure assets by providing their own next-generation OTT content and smart home services as add-ons. There are plenty of new business opportunities for telcos that forge new paths, taking advantage of 5G innovations to provide their customers with the kind of creative, value-add services previously only offered by OTT players.

Telcos often struggle to manage disparate bandwidths, configurations and legacy networks while maintaining high-quality services. One of the most important investments for telcos today is in building up Cloud-based digital platforms that can unify these different technologies. This is a long-term commitment and serious investment, but it is the only way to provide the scalable bandwidth required to support consumers’ ever-growing appetites for data.

Read more in the latest issue of TVBEurope.