CDN Providers and Surging OTT Demand
The OTT, or Over-the-Top video content is a trend that’s been growing phenomenally over the last few years. According to a study by the Allied Market Research, the global OTT market size, which was valued at $121.61 billion in 2019, is now projected to reach $1,039.03 billion by 2027, growing at a momentous CAGR of 29.4% between 2020 and 2027.
Covid-19 pandemic has given a massive push to the OTT’s trend in services and content delivery. As Coronavirus forced global lockdowns, we can say that cutbacks to the travel industry have transformed into the OTT industry’s gain. The OTT subscription volumes and engagement rates increased straight up.. For example in India, which is the fastest-growing market for OTT consumption worldwide, in 2020 the number of paid OTT subscriptions, referred to as SVoD increased to nearly 100-125 million, rising by about 55-60 percent, up from 49 million subscriptions in 2018. (source: Moneycontrol.com) More affordable than ever before home broadband, the OTT services fill the gap created from disruption of routines, and they have quickly become essential ‘lifeline’ services.
The sudden shift in user attention towards OTT services presented more revenue-generating opportunities for OTT content providers, but with a huge ask. Succeeding in this competitive market space requires high optimizations on both the customer-facing front-end and the infrastructure back-end. The performance and delivery quality need to scale as well with the rise in user volumes. Poor service quality will adversely affect the user experience, impacting customer satisfaction levels and encouraging user churn to the competition. Especially in today’s social media age, where incidents can quickly snowball into a PR issue for the companies. Today users are used to binge-watching television shows, movies and documentaries, and this user group expects low latency, minimal buffering and TV like performances. Managing these high expectations at a scale for user groups, especially across the globe in multiple locations, is a technological challenge to say the least. The traditional IT infrastructure and the client-server model is not well optimized for efficiently handling these large volumes of queries.
These challenges have given prominence to Content Delivery Networks in the OTT delivery architecture. CDNs provide a crucial solution that makes it efficient for content providers of all sizes to instantly scale out, and to scale back based on their network demands. CDN essentially is a cloud platform that caches the data and optimizes files such as video, image, music, codes etc. that enable the end-user to access any device quickly.
CDNs work by using a network of strategically located servers to cache information. When the user requests content, it is served from the nearest cache server, instead of the request to travel to the origin server and back. This is highly efficient and effective for multiple reasons. First of all the geographical proximity means that the request-fulfillment will be much quicker. This directly impacts the buffering speed, and faster content-delivery lowers the video latency. Therefore, the main advantage of OTT is to ensure a flawless User Experience by preventing delays in content transmission.
Using a distributed architecture, CDNs cache the OTT content strategically at the closest points to the end-users. This way; User requests for the video content, are served from the nearest CDN point (referred to as the CDN’s Point of Presence);nstead of the content having to come all the way from the CDN origin server -where all the content is stored.
- Analysts expect CDN platforms will continue to maintain the surge in volumes. Therefore, to scale for performance and high service delivery levels will remain as crucial as ever, for the OTT service providers to push for business growth and maintain customer loyalty. Hence, as we move ahead into a new decade, CDNs will become even more important partners for the OTT service platforms in their quest to grow a global base in this lucrative market segment.
- Another major benefit provided by CDNs for OTT platforms is the scalability that they provide. For OTT platforms, viewership numbers differ significantly across the year. The viewership spikes mainly around the finals of major sporting events, highly anticipated release of movie and television shows and around major holidays. At the same time, the viewership might be low for many weeks or even months. Investing in a physical server infrastructure to handle these viewership spikes will be costly. A lot of these invested resources will end up lying idle when the lean season is there. It is not efficient from cost perspectives along with operational expenditures even when you are not using your infrastructure adequately. A CDN service provides immense scalability since you can immediately sign up for additional resources. aWhen your network and consumers require to instantly scale back when the peak time is over, a CDN will save you significantly in the process in terms of costs.
- A third major benefit of CDNs is in terms of security. As DDoS attacks and cyberattacks are becoming more frequent these days, CDNs utilize advanced and state-of-the-art software architectures to mitigate these malicious attacks to ensure that your service is up and running all the time. With OTT platforms enjoying so much attention in the media these days, an adverse event such as cyber attack could have big unwanted blowbacks for the business.
At Medianova, we provide state of the art CDN services to several top companies globally. The websites that we manage using the medianova infrastructure get over 2 billion hits a day, and are reaching over 30 million internet users without creating any problems. Today, 70% of the national media companies in Turkey use the Medianova platforms.
Feel free to get in touch with us. We would be happy to take you through a session to understand your requirements and to assess how to use a CDN to optimize your delivery performance and scale.