Recent Survey on OTT Video and Security Trends Offers Insight into Current and Future State of OTT Video

As it moves into the mainstream, over-the-top (OTT) video is maturing towards a pay environment, with sustainable business models. Premium content delivery is becoming both a more significant component of the overall online video business and a more dominant mode of video delivery.

Video content is not just consumed within the confines of the home either—increasing numbers of consumers are demanding more of the “everywhere” aspect of TV—watching live or catch-up programs on-the-go. The traditional set-top box tethered to the television set, once the center of consumer home-based entertainment, is now but one shared video device in a multi-screen world of personal delivery options.

These are some of the findings of a new survey of 758 media industry executives, which sought to uncover their views on the current and future state of OTT video from inside the trenches. Respondents provided new details about the business, highlighting shifts in models, commercial and technical challenges and security implications for the growing business sector. These respondents in the three key sectors of this industry —pay-TV operators, content providers, and technology providers —already see significant parts of their businesses influenced by the OTT model, in which programming, both live and on-demand, is delivered directly to consumers’ devices, piggybacked on broadband networks.

Key findings of the survey include the following:

  • Over-the-top delivery is a growing business driver for the industry—Perhaps in large part because of the trend above, both the number of companies involved in OTT delivery will grow and the proportion of those businesses substantially invested in OTT technologies will more than double over the next three years.
  • TV is taking over the Internet (not vice versa)—The pay model for OTT services is seen as growing in dominance compared to a free or advertising-supported model. This is a very significant change of perception for Internet video, which was initially interpreted as a free alternative to traditional TV services.
  • There’s a new big screen in town—The tablet has established itself as the new viewing device of choice, according to respondents, although executives are aware that device preferences are changing rapidly, and that many types of technologies and formats will need to be supported within today’s multi-screen environment.
  • The Internet is not big enough yet—Bandwidth and quality issues are still seen as significant technology challenges by respondents. Video on demand, using HTTP Live Streaming (HLS), is now the most prevalent type of service, but executives expect to see more services focusing on linear content—the streaming of live events, especially where social networking capabilities are seen as a key piece of OTT offerings.
  • Challenges with gaining multi-screen content rights— Obtaining broad content rights to stream video to multiple screens is felt to be a significant business growth obstacle. The legal and legislative tangle is especially thorny in the U.S. market where there is ambivalence to breaking traditional business models.
  • OTT video security—Encompassing stream protection and digital rights management (DRM) is a murky area for many organizations to navigate. A transition away from proprietary technologies, such as Flash, has created a landscape of options. It appears too early in the life cycle of MPEG-DASH to see how this might help unify infrastructure and consumer electronics configurations.

Full results from the report, entitled “OTT Video: Coming to a Paid Channel Near You” is available as a free download from the website.