A Paradigm Shift Towards Localized TV and Video ViewPlace at Scale

Mar 24, 2022

Media & Entertainment | 9 min READ

Universal security lead the priority for more than half of media enterprises

In today’s highly fragmented D2C (OTT TV & video services) landscape, audiences especially millennials have a wafer-thin attention span i.e., less than 10 seconds. This is gradually but eventually instigated majority of audiences to subscribe to multiple OTT TV & video services (average US household subscription stood at 2.61 while 1.75 in the UK) along with acceleration of content piracy index (pirated media assets resulted into 230 billion views) in 2021.

Kedar Mohite

Former Global Head - Media & Technology Practice

Birlasoft

Sandeep Desai

Vice President - Business Relations, CMT

Birlasoft

Furthermore, as increase in ARPU (Average Revenue Per User), and lowering churn become the vital Key Performance Indicators (KPI’s) for majority of media enterprises with an OTT first growth strategy, this paves way for increasing content aggregation and bundling partnerships on the long run. As per Omdia’s Global OTT Video Bundling Deals & Service Partnerships Tracker: 1Q21, there are close to 900 digital service provider and OTT platforms active partnerships encompassing 170 D2C services globally.

Although, Netflix has one of the largest partnership agreements with close to 164, followed by Amazon at 95. Also, as niche market positioning is pivotal for long-term competitive edge, focusing on multiple OTT platform bundles especially local and regional services is witnessing an upward trajectory in the past 12-18 months. Thus, as complexities and multi-faceted bundling configuration (soft; and hard¹ ) continue to rise, media enterprises are pushed towards embracing unified workflows to not only improve operational productivity but also safeguard profitability margins. Therefore, in order to create a converged, and cost effective ViewPlace (i.e., a single entertainment hub for multiple bundled services), cloud based Universal ecosystems² to witness strong adoption curve in the next few years to enable media enterprises to meet these changing business requirements.

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Unified content supply chain to drive Universal ecosystems value proposition

In today’s borderless multi-screen TV & video era, hyper localized digital audience preferences are pushing majority of media enterprises to build or create an unlimited value chain of content repositories across both live and VOD (Video on Demand) assets. This has gradually paved way for enterprises to embark on the content aggregation journey to enable not only to lower churn but also acquire newer niche customer base within both regional but global markets. Although, the aggregation ecosystem results into significant engagement rates, and exploiting newer monetization avenues but also have multifold increased the content supply chain complexities. Traditionally, media enterprises have followed a “best of breed” technology procurement lifecycle i.e., deployment of siloed architecture led on premise (prerequisite infrastructure costly) or cloud (lift and shift) technology stacks, resulting into creation of inefficiencies, higher maintenance, and support costs on the long-run basis. Furthermore, as multi-faceted aggregation (single asset, end to end OTT application, or multiple services bundling) becomes the new norm, this paves way for unification of content supply chain to not only increase operational productivity but also safeguard competitive edge (via protecting brand equity losses). Omdia’s ICTEI survey 2020/21, highlight that slightly more than two-fifth (41%) of media enterprises globally, unified content supply chain operations are the leading business priority in the next 18-24 months. Furthermore, majority of media technology vendors have diversified (through both organic and inorganic modes) their capabilities and functionalities building a vertically integrated ecosystem woven around a single workflow across the content supply chain. Couple of examples are:

Verimatrix acquisition of Inside Secure to enrich its offering within application shielding etc. along with expanding footprint into IoT and connected car segments
Rightsline purchase of Real Software to strengthen financial and royalties’ functionalities along with extending penetration into newer markets such as gaming, publishing, consumer products, life sciences and high tech
Akamai building in-house capabilities around security (SOCC), and web performance acceleration (MPulse) to deliver a unified ecosystem woven around media distribution
Brightcove and Ooyala together creating a vertically integrated online video delivery ecosystem value proposition, and
Recently Limelight purchasing Edgecast to improve edge-based video distribution workflow competencies along with exploiting newer opportunities within cloud security and enterprise CDN space
Encompass acquisition of Babcock’s media services to accelerate its playout services ecosystem and penetration within EMEA market.

Thus, it can be witnessed from the above that converging multi-dimensional content supply chain is an impeding push both from buy (enterprises) and sell (media technology vendors and ICT service providers) side across the media & entertainment segment.

PaaS one of fast emerging cloud delivery mode lies at the epicenter of Universal ecosystems

Gartner estimates that worldwide public cloud spending to US$398bn, with year-on-year growth of 20% in 2022. Although, Software as a Service (SaaS) will remain the largest segment accounting for almost two-fifth (37%) of total spend, it will register a slower growth of 19% as compared to the overall (21%). Platform as a Services (PaaS) will retain No 3-positioning controlling 18% of total spend but will witness strong annual growth of 25% by 2022.

A paradigm shift towards localized TV & video ViewPlace at scale

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In the M&E space, PaaS deployment mode is estimated to exceed both SaaS (+28%) and IaaS (+32%), with an annual growth of 39% in the next 12-18 months. Also, building Universal ecosystems on PaaS deployment configuration will also be prominent attributed to:

Key characteristics (Pull)³	Reference to Universal ecosystems (Push)⁴
Negligible need for owning and installation of in-house hardware and software to run applications	Managed multi-generation horizontally integrated applications across a single ecosystem (e.g., content management) via best-in-class technology vendor
Customization and lower administration TCO	Each ecosystem demand bespoke customization and ease of tangible and intangible complexities mitigation (centric to both resources and costs)
Pre-packaged horizontally integrated services, and solutions without managing back-end infrastructure	Single one stop multi-dimensional services across a single workflow without need for focusing on maintenance, upgradation etc.
Faster shorter lead-time-based deployment of newer applications to meet changing business requirements (COVID anti ripple effect)	Real-time, cost effective, on-going access of newer applications and solutions within a single agile ecosystem

Pull is defined here as inherited characteristics or benefits of a PaaS cloud deployment configuration
Push is defined here is benefits of a PaaS centric Universal ecosystem for media enterprises and their IT departments/engineers/developers assisting them to meet the business priorities

Thus, as media enterprises embark on the aggregation journey to create a localized personal ViewPlace⁵ for each audience base will eventually acceleration the adoption of Universal ecosystems across the content supply chain in the next 2-3 years. This is pivotal due to bundling of multi-faceted assets, OTT services and in future non-media digital services within a single super offering will demanding:

Streamlining of the operational media value chain ecosystem, and
Tight integration with diverse external third-party content owners and aggregators.

Universal Security top priority of media enterprises in the next 12 months

In January 2022, Birlasoft conducted a single question poll on LinkedIn to evaluate the demand for PaaS enabled Universal ecosystems across the M&E space. The poll findings revealed the following

Universal ecosystems	Keynote	Core driver of the ecosystem	Thought leadership example
Security platform as a service.	The top priority for 53% of respondents stood as Universal Security platform as a Service in 2022 i.e., a managed PaaS solution offering services across content (DRM, watermarking etc.), linear & non-linear platform (CAS), and cyber security.	Protecting internal and third-party content, data, and information repositories to be a necessity in the aggregation world to safeguard brand equity.	The value of content aggregator brand and its market positioning is hampered with a DDOS attack or content security breach (own- or third-party IP theft). Thus, leveraging Universal PaaS security ecosystem to become pivotal for each of these hyper content aggregators in the upcoming years attributed to rising security risks across multiple digital user, and partner engagement touch points.
Content + search, discovery & syndication platform as a service.	Slightly more than a quarter (27%) highlighted that Universal content management remain their leading priority followed by one-eighth (13%) to focus on building a Universal search, discovery, and syndication workflow for their super aggregation ecosystem.	Building a scalable internal and third-party content, data, and information repositories to be crucial differentiator in the aggregation world to create premium QoE (quality of engagement.	Loosely coupled multiple assets and digital services bundled within a single content lake will not only lead to churn but also lead to long-term cash flow margin risks i.e., digital users although demand for unlimited content access but also need a highly interactive, and personalized experience. Thus, utilizing a Universal PaaS content management ecosystem encompassing media acquisition, archiving, and re-purposing workflows will be pivotal in the coming years to streamline multi-faceted digital user engagement touch points at scale.
Cognitive services (AI/ML) platform as a Service.	Less than one-tenth (7%) believed that Universal cognitive services (AI/ML) is essential differentiator for their business in 2022.	Multi-screen highly compliant distribution of internal and third-party content, data and information repositories is must in the aggregation world to lower revenue leakages.	Human capital intensive multi-dimensional asset compliance workflow across both premium, mid tiered and UGC repositories to not only enhance TCO but also lead to operational inefficiencies resulting in loss of brand equity in case of non-compliance. Therefore, employing a Universal PaaS cognitive services (AI/ML) ecosystem pre-packaged across the upstream (i.e., media acquisition) to downstream (i.e., media distribution or multi-channel publishing) content supply will ease productivity and hyper localized premium experience to each digital user Anywhere Everywhere in coming years.

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Although, the poll results highlight a strong push from the buy side (media enterprises) towards embracing Universal ecosystems, the paradigm shift is further validated by the sell side (media technology vendors) as well. A good example is in February 2022, Verimatrix launched their flagship unified platform as a Service offering “Secure Delivery Platform” providing enterprises with protection based ecosystem encompassing services woven around cyber security, TV & video anti-piracy, Digital Rights Management (DRM), Conditional Access System (CAS), and application shielding. As, time to market, scalability, safeguard profit margins, and lowering multi-modal integration become the core performance indicators (KPI’s) for media enterprises embarking on the aggregation (global, regional and local digital services bundling) roadmap, embracing Universal ecosystems such as Verimatrix’s Secure Delivery Platform to be pivotal on the long run. Furthermore, pre-packaged upstream and downstream content supply chain workflows such as rights & royalties processing, playout services, content delivery networks etc. will also eventually reduce the media value chain fragmentation dynamics (siloed architecture-based workloads) along with technical debt risk.

Finally, as bundling of local digital services continue to rise attributed to carving niche market positioning and unique differentiation in the highly competitive connected media economy, PaaS based Universal ecosystems will ease this transformation journey along with lowering long-tail inefficiencies across the content supply chain.

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² The platform is a cloud ecosystem that combines multiple services across a particular workflow within a single experience. A good example is Universal security encompassing conditional access, digital rights management, anti-piracy, shielding, cybersecurity, and watermarking into a single platform as a service offering.

³ Pull is defined here as inherited characteristics or benefits of a PaaS cloud deployment configuration

⁴ Push is defined here is benefits of a PaaS centric Universal ecosystem for media enterprises and their IT departments/engineers/developers assisting them to meet the business priorities

⁵ ViewPlace is similar to a marketplace but similar to a super aggregation model encompassing multiple media services under a single UI/UX. Furthermore, each of those pre-aggregated OTT TV & video services might render a diverse monetization avenue similar to a marketplace. A good example is Amazon Video developing a localized ViewPlace through bundling of multiple OTT services such as Lionsgate, ShortsTV (short form content), DocuBay, and Discovery+ along with its in-house Prime Video to its customer base.