How COVID-19 is Aiding to OTT Streaming Video Business

OTT platforms provide a great option to keep people busy during their time indoors and here's how the entire industry of OTT platform has worked it out.

The unexpected spread of COVID-19 has changed the way people work and live. Work from home and homeschooling is the new trend as families are mostly confined to their homes.

It has led to some interesting innovations to make people’s lives better. Some of them are video conferencing, telemedicine, grocery delivery, and the most talked about is the OTT service. Businesses can leverage OTT as they observe the public health protocols laid down by various states.

Many malls, adventure parks, and cinema halls have been closed for good, leaving customers with limited entertainment options. OTT platforms provide a great option to keep people busy during their time indoors and here’s how the entire industry that includes content producers, professional broadcasters, and OTT platform providers have worked it out.

Advanced pricing models

OTT players are adopting innovative pricing techniques to attract and retain customers. Video monetization is now possible with the adoption of subscription-based models such as SVOD and AVOD.

The subscription-based video on demand (SVOD) charges viewers to access content quarterly or monthly. If the viewer wishes to have unlimited access to on-demand content or library, they pay an annual subscription fee. Viewers can know exactly what they are paying for and therefore, it is convenient.

The ad-based video on demand (AVOD) uses sponsored advertisements to monetize content. Viewers are required to take a few minutes or seconds to watch an advertisement. This method is ideal when an organization wishes to deliver content to people who desire to pay less for streaming.

The ad-supported advertising supports the free content model. It is an effective strategy to attract subscribers in developing countries, although it may not be applicable in a similar way everywhere as different markets apply different pricing models.

Another common model being adopted by OTT platform players is the Freemium model. Freemium model features incentives for attracting new subscribers using the open access system that allows them to select a content catalog. The pay subscribers can access the premium content. This helps to increase the average revenue per user (ARPU) and boost the subscriber base.

Broadband penetration

The growth of the OTT streaming video business has been accelerated by increased broadband penetration. COVID-19 has made states understand the value of improved connectivity and its application in areas such as remote working, education, telemedicine, and more. The 5G network has powered the use of mobile technology and expanded broadband internet access through the fixed wireless access (FWA).

Many governments globally are investing in improved broadband initiatives to expand broadband adoption and coverage. Developing countries that had not initially embraced the 5G network due to its affordability are now prioritizing it. These initiatives have played an important role in the success of OTT videos.

The content delivery network solutions are facilitating the pre-positioning of content on the preferred user devices. Many organizations have the capacity for advanced 5G access and to upgrade their core networks in general. OTT video streaming services are supporting network capabilities.

Streaming via the internet requires a huge consumption of bandwidth to attach files to emails, publish live streams and save files to cloud storage. Many businesses are leveraging the quality of their production by knowing their network’s upload speed. The current technology can support the uploading of videos with a larger capacity.

The bandwidth allows businesses to encode their streams to fit their networks. Uncompressed videos can consume too much bandwidth during uploads and this may be unreliable to the viewers. The advanced bandwidth technology allows for content encoding using a small program referred to as a codec. Encoding is aimed at digitizing and compressing audio and video content to a file size that is bandwidth-friendly.

Smartphone penetration and access to high-speed internet

The majority of the people in the world today have access to smartphones. Viewers can connect their devices with OTT services and access the content they want anywhere, anytime. This is also attributed to the accelerated rollout of LTE and mobile broadband by the Mobile Network Operators in the emerging countries in the MENA and APAC regions.

The MNO partnerships and package bundling have made it possible for consumers to access content via their mobile phones cheaply. Mobile technology is becoming the most preferred platform for people to access video content. It is also the predominant and acceptable channel for the distribution of services.

OTT is allowing businesses to narrow down their target audience. Services like Netflix and YouTube generate revenues through smart subscriptions and they no longer need to rely on advertising. Their success has created many platforms that earn most of their revenue through video-enhanced video content.

The focus shifts back to identifying the video content that can be placed on their OTT advertising. Businesses can develop their target market for OTT the same way they do for social media campaigns. Apart from narrowing down their audience, businesses benefiting from OTT campaigns in the following ways:

  • Enhanced analytics – Analytical data defines the future of marketing development. OTT is enabling businesses to capture insights and data needed to evaluate marketing performance.
  • Quality and affordable content – OTT is placing advertising in line with affordable and high-quality content.
  • Appealing to the younger generation – The demand for OTT is higher among the millennials. They are willing and able to pay for valuable content no matter the cost.
  • Micro-targeting capabilities – Businesses can focus on their target audience and produce content that can influence their decision-making.

OTT App personalization

Internet access, increase in income, and smart device proliferation has accelerated access to OTT services. Consumers want to choose the content they want to access as per their flexibility and comfort. This has accelerated VoD services, making home entertainment via streaming easy.

Viewers have enjoyed seamless experiences through content localization and the ability to choose a genre, personalization, titles, and viewing flexibility. Such deep user insights gained from OTT apps allow them to customize their offerings through data-driven decisions.

Businesses are offering recommendations depending on the real-time data or viewing history. This strategy is aimed at boosting content visibility, leading to more clicks and consumption. They are also personalizing their playlists for their users to improve the CTR.

To enhance the accessibility of OTT video to viewers, organizations are building platforms that display their library of video content. Many platforms have smart TVs, cable TVs, and mobile versions to enhance compatibility and accessibility. The video hosting platforms offer SDKs and API access that allow organizations to meet their audiences’ needs.

Media streaming technology advances

OTT video was started due to many people wanting to live stream or watch content at their convenience. They wanted to watch the content anywhere, anytime, using a device of their choice. They also wanted something different from what they access through the TV channels. Thus the OTT video on demand emerged.

Technology has played an important role in supporting OTT video services. Features such as large content repository, cloud-based streaming service, zero-buffering, and Video-on-demand to support live content have simplified the use of OTT platforms. Various OTT devices that ensure that viewers are not confined to their TV sets when watching online videos, shows, and films include:

  • Tablets including iPad, Galaxy Tab A, and Microsoft Surface
  • Smartphones such as Androids and iPhones
  • Gaming consoles including PlayStations and Xbox.
  • Smart TVs.

Most OTT platforms are developed to replace traditional television. Viewers prefer accessing content via their mobile devices. OTT technology can work on any device as long as the device is linked to an HTML5 video player.

The need for exclusive content

The increased demand for OTT has fueled the growth of this industry during the COVID-19 pandemic. Streaming continues via the OTT technology and subscribers are looking for exclusive content. During the COVID-19 crisis, OTT VOD viewership has greatly increased and therefore, production houses are moving to the digital space for content monetization.

The production houses are identifying consumer preferences and tailor offerings based on the market. For example, BBC has launched a platform that allows viewers to access content even before it is aired on television. Viewers have been able to get updates concerning current issues such as the COVID-19 vaccine updates before television broadcast. This approach enables players to keep up with the demand for content by the viewers as they maximize their content.

Besides promoting the original content, some OTT service providers are also establishing unique tie-ups with established networks to provide personalized TV experiences.

Instead of focusing on competition, production houses, broadcasting networks, and OTT service providers collaborate to attain a solid market share. This is more effective today as many viewers are focused on using more than one platform to access the content. The top OTT market trends are characterized by partnerships and a mix of cable and TV broadcast networks.

Organizations are providing navigation-based personalization, allowing users to adapt fast so that they can get the content they are looking for at any time. They are also leveraging on gathering peoples with common interests and offer content that is suitable for them.

The bottom line

OTT was there before the COVID-19 pandemic but its popularity has been boosted due to the current scenario. Millions of people are in lockdown and they need ways of having access to entertainment sources and OTT is proving to be their go-to thing.

Companies have developed unique pricing models to attract more subscribers and churning out fresh content regularly to keep viewers engaged. They have also explored various technologies that have contributed to the overall success of the OTT-streaming video business. In terms of the future, OTT is here to stay and content providers and professional broadcasters will keep expecting new technological backup to keep their businesses moving which is a great opportunity for the OTT platform providers.


Originally published on April 22nd, 2021, updated on May 17th, 2021
The Blog

How COVID-19 is Aiding to OTT Streaming Video Business

by Simi time to read: 6 min