Cable and over-the-top (OTT) providers are striking an unusual friendship, one that leads to profitability for both sides once some large challenges are hurdled, according to the latest report from Heavy Reading Cable Industry Insider (www.heavyreading.com/cable), a subscription research service from Heavy Reading.
“Cable & OTT: New Opportunities for Convergence” explores the market drivers, opportunities for convergence and the challenges ahead. It includes profiles of 10 cable software suppliers that offer solutions that support cable’s TV Everywhere and multi-screen initiatives, which also can lend support for cable-OTT integration.
“As OTT video streaming services and devices began to attract consumers, they appeared like barbarians at the gate, ready to disrupt traditional media and topple the longstanding empires of cable and other television establishments,” notes Craig Leddy, research analyst with “Heavy Reading Cable Industry Insider” and author of the report. “Disruption indeed has occurred and will continue to occur, but the once-combative stances of cable and OTT players has taken a unique twist as both sides have come to realize that they can profit by utilizing each other’s strengths.”
Cable’s online video efforts provide new business opportunities, Leddy says. “In order to make a courtship work, cable and OTT players need to overcome large challenges, including technical integration, territorial rights issues and monetization to provide a return on investment for all players,” he continues.
Key findings of “Cable & OTT: New Opportunities for Convergence” include the following:
° Once fierce combatants, cable MSOs and OTT providers are finding mutual ground to work together.
° Comcast’s interconnection deal with Netflix shows how cable can become a distribution partner for OTT video streaming services
° MSOs are increasingly providing customers with apps that provide cable TV access through Roku, Xbox, Apple TV, smart TVs and other devices
° New cloud-based IPGs offer a cable portal for OTT apps and social media; TV Everywhere solutions can support OTT apps, too
° Some OTT content and device providers are willing to pay bounties to MSOs to help expand their business.
° 4K Ultra HD forays by Netflix and other players could be a battleground – or convergence point – for cable.