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Trends Shaping OTT: 2022 and Beyond

Over the past few years, the growth in online streaming has transformed viewing habits as never anticipated before. According to Gartner Inc, adults in the U.S. spend an average of 63% of their overall TV viewing time streaming versus cable, broadcast, or satellite.

With the surge in activity, we witnessed a rapid acceleration of predominated trends and the introduction of new opportunities for revenue generation. The North American OTT market is set to double its revenue to US$94 billion by 2026, according to Digital TV Research.

Here is a round-up of developments in the OTT industry and trends to watch for this year and beyond.

Content vs Platform

The OTT streaming market is packed with an abundance of options for viewers. However, abundance has turned out to be a bane due to the countless number of subscriptions a viewer has to deal with. As content is fragmented across many OTT services, viewers' loyalty will incline towards their favourite content rather than platforms themselves.

Keeping viewers hooked requires offering premium content along with the right business model. Furthermore, we are likely to see a rise in consolidation among brands looking to draw complementary strengths from each other’s content libraries, similar to the coming together of SonyLiv-ZEE5. Another strategy providers use is bundling of OTT subscriptions with other services.

Modular Architecture Becomes a Necessity

With constant innovation and fierce competition in OTT, there will be a significant demand for architecture that supports faster time to market and on-the-fly scalability. OTT providers will increasingly look at taking ownership of the infrastructure to meet changing market needs quickly. Meanwhile, they will also pivot towards integrating commoditized software components for adding novel features to the platform. This will require a flexible and modular architecture that supports swift integration with own or third-party systems, services, or applications.

Localized and Niche Offerings

There will be a rise in OTT platforms that caters to diverse audiences and specific interests. Such platforms will differentiate their offering with localized content to suit regions and demographics they target or focus entirely on niche categories. For example, DutchChannels New Faith Network focuses purely on religious content, whereas its WithLove platform is dedicated to romance and feel-good content.

The Era of Interactivity and Engagement

With a variety of streaming services to choose from and limited time on their hands, viewers now demand differentiated experiences to stay engaged with a platform. The shift towards an engaged viewer has evolved the streaming landscape into a two-way flow of content and interactivity between viewers and providers. This new era is known as OTT 2.0, in which viewers do not just watch content but also engage with it.

The introduction of video games into the streaming experience is one such strategy that Netflix is exploring, with other streaming services likely to follow suit. Platforms will use the data generated to personalize streaming experiences by pushing relevant and contextual content.

Multi-View and Shared Viewing

Two ways of viewing content that gained a lot of traction in 2021 were multi-view and shared viewing. Multi-view is the option for viewers to watch streams from different angles. Such a capability creates an immersive viewing experience, especially for sports and live events. Shared viewing allows people to enjoy content together even though they are not in the same location. This type of social viewing gained popularity with tools such as Netflix’s Teleparty.

All such streaming experiences are becoming a standard expectation by viewers and will be extended with more features in the future.

Targeted OTT Advertising With AVOD

More providers will explore ad-based streaming due to the immense revenue potential it brings. According to Digital TV Research, AVOD would be the largest OTT growth sector in North America, and revenue is projected to reach $32.61 billion by 2026.

A key reason advertisers are drawn to OTT advertising is the niche audience base it can target through streaming devices and services. Targeted advertising minimizes ad spend waste by showing suitable ads to the right audience. Moreover, OTT advertising can enable interactive ads where viewers can interact with what they see rather than passively watching them.

OTT for Sports

There would be an increase in OTT streaming services for sports. As traditional TV subscriptions keep dropping, live sports was one area that was yet to transition to online streaming fully. However, the emergence of 5G has created a stronger push towards embracing OTT for Sports. Through OTT, sports fans can easily live-stream their favorite sporting events from any device, along with a plethora of possibilities for interacting and engaging with the platform, whether it be fan reactions, betting, fantasy leagues, and many more.

Moreover, OTT platforms catering to sports can explore numerous revenue streams not possible in traditional TV, such as targeted advertising, personalization, live stats, etc.

What’s Next?

With the accelerated pace at which the OTT industry is evolving, it is crucial to set up your OTT platform on a proven technology stack designed to capitalise on future opportunities.

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