Hosting a party at IBC 2019 was a truly honorable experience for us and a great occasion to craft Medianova’s name in the ecosystem. We had a blast catching up with friends and colleagues from the streaming and OTT industries, and we learned immensely from each other.
According to a Market research conducted by Frost & Sullivan, OTT and streaming industries will triumph for the next three to five years, given the rise of consumer demand. Additionally, live sports and original content will be the key drivers of growth embedded with robust technology.
With this growing market, it is widely known that the biggest business challenge of OTT companies is to keep the churn rate low and to make sure that the users remain loyal to the service. Obviously, when the user has a broader spectrum of choices and other providers are just one click away, then retaining him becomes a real challenge.
On top of that, most OTT services do not rely on blockbuster content anymore, therefore keeping the customer also becomes an issue of service performance and user experience.
From a technological perspective, here are the topics that caught my attention during IBC 2019.
Machine learning and Artificial Intelligence (AI) Use Cases
Machine learning and AI are very hot topics for the last couple of years and we are starting to see some use cases in the video industry.
One of these use cases is about Compliance. Governments are getting cautious about controlling the content flowing through OTT services and they want to make sure that there is a safe and appropriate version for the younger audiences. Apparently, machine learning operates in a way of locating inappropriate scenes and removing them from the video automatically.
Another use case of machine learning is related to subtitles. Thanks to this revolutionary technology, adding subtitles to videos in different languages became a piece of cake. It is even reported that the current accuracy is about 98%, which is a good start.
We know by now that Recommendation and Content Discovery are gaining more extent in the user’s engagement. AI and machine learning are providing great solutions for customizing offers based on viewers preferences. As a matter of fact, one Key Performance Indicator for Recommendation is the time spent by the user scrolling up and down, left and right, before starting to watch the content.
If the system offers many options and the user is subject to the “paradox of choices”, thus still keeps browsing, one can conclude that the Recommendation is not at its best. Content browsing time is an important metric to keep an eye on.
We previously talked about the importance of keeping a low churn rate and retaining users as paying subscribers. It is obvious to say that another key criterion to achieve high user retention is having an error-free platform. UX is the key and users expect a broadcast-like quality, especially when they are watching laid-back content.
From a technology perspective, Real-Time Analytics becomes very critical to achieve this business goal. We are told that most CDNs are not capable of delivering error logs in real-time and some need 6 to 8 hours to make the logs download ready.
At Medianova, we agree that reaching real-time error logs makes total sense and that is why we provide elastic search and kibana clusters to provide this information to our customers. I believe we will see more CDNs and startups working on this. Maybe next year, most of them will gather data from CDNs and/or players to make sure the performance and errors are visible and measurable to the technical and business executives of OTT companies.
Multi-CDN Switcher and Services
Content delivery is still one of the key challenges. To tackle that problem, the concept of ‘Multi-CDN’ started to appear a couple of years ago, implying a mix of CDNs working together to deliver the content. The selection of the CDN is decided by a smart Multi-CDN switching software measuring user performance analytics based on the actual delivery performance of the CDN. (Oops, no more selling a CDN with just a brand name anymore.)
According to Gartner, about 80% of the OTT companies use the Multi-CDN approach and it is a widely used technology by content owners for global delivery.
This year at IBC 2019, there were more and more companies offering Multi-CDN switcher as a service. Since it is a fact that not any CDN is capable of performing its best in different regions, I personally consider it a promising trend for the industry.
DIY and Private CDN
The last spotted trend at IBC 2019 that I would like to mention is the tendency of some companies to invest in their own CDNs and run it with a Multi-CDN approach for failover and to access hard to reach regions.
For the last couple of years, Netflix has been growing and most companies were just happy to provide content and collect their license fees. Nowadays, they realized that the customer relationship and the access to data (i.e what users are watching, what is the best original content strategy and how is their overall experience) are more important than ever.
We know by now that the OTT market is real, it is in the growth phase and cable TV is getting disrupted. Therefore, executives have more budgets to invest in key infrastructure for their service. They also started to realize that legacy CDNs are relying on older software and older hardware built years ago. It is a fact that high performance with older hardware without SSD disks is almost impossible. This also means that having a point of presence does not guarantee the best performance for that region, especially if there is no room to cache large content libraries in many formats in a multi-tenant environment.
Moreover, we now sense the trend of investing in end-to-end streaming platforms to get more data, control UX and make sure the content is secured.
On top of that, experienced OTT companies are updating their platforms with better and more agile ones. These facts lead to more DIY and Private CDN projects with Multi-CDN switching in place.
As a final word, I think the ecosystem and the streaming industry will grow even further and the audience will enjoy smarter and better video services within the next 5 years once the dust settles.
Please do not hesitate to reach out to us if you would like to know how Medianova’s team tackles these problems and how the solutions we offer to the market such as real-time analytics, end-to-end streaming and managed private CDN platform can help you skyrocket your business growth.