OTT Broadcasting (Over The Top Broadcasting) is the term used for the delivery of broadcast content over the Internet, without requiring its users to subscribe to a traditional/satellite cable TV provider. OTT generally is provided in the form of Apps running on Connecting Hardware which have capability for Internet access.
The main components of an OTT system are as follows:
1) Content Provider: Can be an independent service, traditional cable provider, Traditional TV network or P2P network.
2) Public Internet: Used for transmission between Content Servers and Consumer.
3) Receiver: Enabled with Internet connection. Could be a Web Browser on a computer, an app on a mobile, Digital Media Player with Remote Control.
4) Display Device: TV, Computer, Mobile Screen.
Traditionally in Video, all content was provided by Multiple System Operators tied with Local System Operators who used to charge a subscription fee for a certain number of channels provided to the end consumer enabled by analog cable/digital cable with a Set Top Box. Continuing along with this business model with the emergence of technology, saw the rise of DTH services and ISP enabled cable services augmenting the existing ecosystem of content delivery. This business model kept profits high for the Pay-TV providers who bundled their most popular channels with less popular ones.
But, this changed and how!
The rise of Internet and the increasing bandwidth support that it offered over time was one of the main reasons why OTT broadcasting was taking center stage as compared to the traditional content delivery networks. Netflix, which partnered with HBO to telecast their older programming — showed HBO exactly why OTT was here to stay. The number of subscribers on Netflix outnumbered HBO’s domestic subscribers by roughly 6.3 million users. Recognizing the need to change their business model, HBO entered the OTT market with HBO Go and a slew of CDN’s populated the Videoscape from then on.
Content Delivery Networks like Netflix, Hulu have started to dominate the mobile and desktop screens whereas, Digital Media Players like Apple TV and Roku are built to bridge the gap between existing display systems, Internet Infrastructure and Content. While this may seem like impending death for traditional cable providers, we should not forget to factor in the necessity for a reliable broadband connection for the provision of these cost effective content delivery solutions — Cable Operators now are shifted to the role of the backbone providers without whom all the features and ease of use of OTT broadcasting would be rendered null and void.
Revenue streams for both ways of transmission: Traditional and OTT have distribution numbers as their primary factor of profitability. OTT video revenue models are taking a backseat as every player in the OTT market is scrambling to get their content online to not miss out a spot on the Installed Apps list of an End User. The future of OTT is undeniably here to stay, but how will it change for the end user in terms of content delivery and pricing is an interesting question to ponder about.
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