NAGRA has unveiled its top trends expected to impact the pay-TV industry in 2018.
The top five are embracing business transformation; understanding consumer behaviour and the user experience; leveraging data analytics and AI; taking a proactive role in the fight against piracy; and implementing new business strategies for ongoing success.
“There are significant opportunities for those that embrace and evolve with the changes that are happening in the industry,” said Ivan Verbesselt, SVP, group marketing, NAGRA.
"By understanding the trends that are emerging in the TV and entertainment ecosystem, pay-TV operators, broadcasters and content owners can make the intelligent business decisions that will build tomorrow’s TV landscape."
The “post-OTT era” is underway: Convergence drives business transformation
The traditional pay-TV industry and consumers themselves can no longer make a distinction between traditional TV and OTT services. The two will become synonymous – TV is simply TV – no matter how it’s distributed and consumed.
As part of this trend, more operators will look to leverage scalable, flexible, agile, cloud-based environments, effectively migrating to IP delivery to offer the content and experience that consumers want. However, while IP will be king, legacy environments will still smartly coexist with new infrastructure for some time.
The ability to easily on-board OTT products onto pay-TV platforms will also play a strong role in future strategies. For example, some pay-TV operators are leveraging native IP technologies, such as Android TV, but will need to embed them into an end-to-end solution that enables them to more seamlessly blend the OTT and traditional TV content into one coherent experience.
Customer journeys: A personalised UX landscape for all consumer types
For years, the user experience (UX) for pay-TV services has been relatively straightforward, with either EPG or app-based formats prevailing. Unfortunately, neither of these options create a completely frictionless UX when the volume of content increases and the industry is embracing the fact that the customer is in full control.
With each person’s unique needs of how, when, where and what they watch, the industry is welcoming an intersection of customer journeys and UX design. Operators offering various options to adapt to unique customer journeys that meet individual demand and consumer types will come out ahead. Core to this are the developments in voice user interfaces (VUIs), AI, machine learning, and also VR/AR as well as IoT technologies.
These new technologies will not only enhance the user experience and drive monetisation, but also help to streamline and improve operational efficiency on the back-end.
Content piracy: Turning innovation into action
From capturing new audiences through e-sports to rising to the challenge of content piracy, there is an immense amount of opportunity and new challenges for content owners and the pay-TV market.
In the last few years, we’ve seen live sports content suffer heavily at the hands of increasingly advanced piracy methods. 2018 is the year where the fight to protect live sports content turns in favour of the industry, and ultimately the consumer.
Service providers will fight IPTV and Kodi add-on piracy with end-to-end content value protection, applying a closed-loop approach that secures and marks content, and then allows for monitoring and actions against piracy.
Visibility: Analytics, big data and AI
Evolving pay-TV business models and services will focus on sophisticated platforms that leverage data intelligence and AI to enable operators to pilot their business and make better strategic decisions.
This can include understanding TV viewers’ tastes and recommending actions that will increase both customer satisfaction and operators’ bottom lines. Those that take the proactive steps to embrace visibility and intelligence into consumer behaviour will come out ahead moving into 2019.
New business models: On the rise
Pay-TV service providers are working to segment the market, offering skinny bundles and flexible OTT offerings to steer viewers away from cord cutting and drive additional revenues.
We can expect this trend to continue developing globally over the course of 2018, especially in regions where content licensing terms provide room for new business model options. “The question is no longer whether these new models will provide a long-term replacement for the loss of revenue from cord cutters.
As a more segmented and personalised TV and video landscape, in which increasingly empowered consumers enthusiastically engage in self-bundling, becomes an established market fact, the issue at stake is to quickly determine what the winning strategies are to take advantage of the new market dynamics.