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Top trends shaping OTT in 2019

The outlook for OTT is looking stronger than ever with a CAGR of 17.4% and an impressive projected revenue that is stipulated to rise to USD 245bn by 2028 (Future Market Insights, 2018). Hence, not only big media and telecommunication giants such as AT&T, Disney, Fox but also e-commerce retailer such as Flipkart (owned by Walmart) are pouring money to build own next-generation OTT platforms either to cash-in on the opportunity or to engage their users further.

Even though this booming industry has caused much disruption in the way media and entertainment are consumed, its evolution has not stopped. Technical advancements in video encoding, encryption and delivery methods to the changing business scenario centering on convergence and globalization, new technologies and business development push the continuous transformation of OTT.

Here, we look at some of the significant trends that will shape the OTT industry in 2019:

Efficient encoding/transcoding

Officially announced back in 2015, with a backing of most technology behemoths, AV1 is no doubt a disruptor in the OTT industry. With a proven increased efficiency over the existing High-Efficiency Video Coding (HEVC) and VP9 codecs, it could potentially lead to realization not only in financial savings but also increased QoE.

Introduction of official support in Microsoft Windows (beta currently), Google Chrome and Mozilla Firefox, and with the stipulated release of supporting hardware chips later this year, AV1 is bound to gain much traction.

Ultra-low latency streaming

When it comes to online streaming it’s not just the video quality that matters, the latency translating to video start time impacts the viewership too. The effect of latency is quite high, as viewers start to abandon a video if it takes more than 2 seconds to load and every further second of delay adds 5.8% to the abandonment rate.

Providers can deal with this harrowing problem of latency by adopting the Common Media Application Format (CMAF). Although introduced in 2016 by MPEG and supported by many prominent organizations, CMAF can now help achieve ultra-low latency, for a high Quality of Experience (QoE), when paired with chunked encoding and chunked transfer encoding techniques. And, with the promised 5G latency of 2-3ms, the paired impact on mobile video QoE and QoS is going to be drastic.

Convergence through data

OTT Ad spending has reached a whopping $2bn in 2018 and providers are investing more and more in the correlation of viewership with consumer purchasing behaviour. The convergence of OTT with e-commerce, aided by advanced analytics and personalized ad-injection is opening up even more revenue models for providers. This also brings us to the next trend of personalization.

Personalizing for loyalty and revenue

Earning the loyalty for the new generation of cord-cutters and cord-nevers takes more than just great content, they expect tailored services based on their choices and preferences. Personalization isn’t just demanded from the content though, recommendations, subscription plans, metadata and even frontends have to be personalized to cater to the new era of subscribers.

Demand for high-quality content

All the technology and business trends, increased prominence of efficient encoding and delivery methods, capable user-end hardware are paving the way for the production and delivery of UHD 4K, 8K and HDR content. Providers are focusing more and more on the production of such content and as 4K HDR TVs are becoming common in households, the industry will see a great demand for it in 2019.

Evolving mobile media consumption

With video stipulated to be 78% of all mobile traffic by 2021, there is an ever-increasing need for higher bandwidth and technical capabilities. The next generation of cellular communication, 5G, is poised to solve this with the promise of low-latency and speeds up to 10Gbps.

And, with the telcos and broadcasters partnering up to leverage on 5G’s capabilities, the way the mobile users consume media content is going to evolve in 2019.

An innovative up to date OTT

Axinom is a digital solutions provider in the media and entertainment industry, serving the industry with scalable and robust products for content management, and protection. Our products have powered some of the biggest media, broadcast, and telecommunications organizations in reaching a global clientele of millions. Since its inception in 2001, Axinom has worked with industry leaders and partners to create a range of products and solutions, covering the backend components for a seamless workflow in OTT. The products are content management (Axinom CMS), and content protection with multi-DRM service (Axinom DRM), supported by globally deployed backend interfaces and services with extensive APIs and integrations. Through numerous possibilities of integration with third-party or existing customer systems and various services, our products are capable of handling subscribers, payments, reporting, personalization, and much more.

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