Digital video consumption is set for a major overhaul with consumers increasingly watching long form content on non-TV screens across connected devices and there are several noteworthy trends in support of this argument – Cisco VNI (Visual Networking Index)
report predicts staggering growth numbers for mobile data traffic, network speeds and connected devices, over 3 million downloads of HBO GO app (currently streaming 98 programs), resounding success of OTT
services (Netflix, Hulu etc.) and announcement of mega content deals like partnership of WaltDisney and Comcast
for multi-platform streaming of programming services. As a key stakeholder of video content industry – TV service providers
are introducing TV Everywhere services to accelerate content convergence
and to on board cable consumers to join the content anytime, anywhere bandwagon.
TV Everywhere in its utopic form is defined as a “Service which offers live, linear and on-demand video content access (tied to cable subscription) across any connected device inside and outside the home running on any platform“. Switching back to reality, TVE in its current form gets restricted to on-demand (with limited live and linear) video content access across defined platforms and devices connected to the home network of the subscribed service provider in allegiance to users subscription package.
TVEverywhere Basic principles
TVE broadly defines itself as transition of broadcasting content (video on demand and live/linear programming) to IP networks bounded by three basic rules – content access is tied to rightful subscription, content is protected throughout its journey and lastly studios and programming networks get their dues. Whereas there are several key stimulators driving TVE landscape and encouraging Tier 1 and Tier 2 MSO’s to offer TVE services there also exists several overheads, challenges and dependencies in form of infrastructure upgrades, network expansion, need for a sustainable business model, customer education and support services among others
To ensure rightful access, TVE service mandates user authentication which can happen either through service providers content portal (when registering for an online account) or directly on programmers portals (HBO GO, ESPN, CBS etc.) by mapping user’s subscription details (customer account number, PIN codes, or, and passwords). While it may sound trivial it introduces additional overheads compared to earlier setup where premium and pay TV content was safeguarded under walled gardens and managed networks (delivering content on service providers installed digital adaptors and STBs) with near absolute control on content. Arrival of TVE changes this landscape to a less closed and even un-managed networks with content consumption across multitude of connected devices making content security and authentication a critical ask.
Content Access Control
In a typical household with one common account subscription, parents need access control policies regulating content access on devices registered with younger users. Ensuring desired access control requires a thought out registration process and permission flow for online viewing to account users for each member /device combination. This adds an access control requirement based on user category and preferences.
TV Everywhere -Challenge
In comparison to traditional broadcast content delivery with subscription tied to account credentials on registered devices, TVE creates additional use cases which needs boundary fencing to honour the three rules (1-2-3) mentioned earlier. Credential sharing is common where users can exchange their username and password with friends and family to enable access to premium and other Pay-TV content. Although there are methods like restricting number of streams/viewing sessions per user or number of devices a user can register, there still exist loopholes which can lead to unauthorized access and revenue leakages.
Quality and Premium Content
In order to remain competitive, TV service providers have to continuously renew and upgrade content contracts with studios which demand still higher rates for programming rights (for inclusion of multi-platform streaming). Since TV networks generate majority of their revenue from carriage fees and ad sales they anticipate limited incentives to put content online which is considered as dilution of content premium. Compounding the problem is fear of leakage of viewership to connected devices undermining ad sales in absence of effective online advertising measurement mechanisms. Above reasons along with piracy and un-authorized content duplication presents reluctance among major networks to move premium and big ticket content under TVE environment
In addition to quality content and flexibility for instant access consumer also expect hassle free, easy to use and consistent viewing experience across multi-screen devices. While ensuring content rights is critical from business prospective, quick validation and almost instant access/playback as soon as user clicks on a selection is a basic user expectation. Supporting content distribution with acceptable video quality on innumerable devices and platforms with different resolutions, bandwidth and processing capabilities brings added responsibilities as part of service offering.
Sound Business Model – Advertising linked sales?
Enabling TVE services (authentication, online content availability, ecosystem support, device support, storage etc.) has significant infrastructure and hence financial overheads which needs a sound business model to fuel its growth and sustenance. The cost burden needs sourcing either through additional subscription fees, ad linked revenues, pay per view or any other hybrid model. In current scenario where increasing subscription fees is least desired and advertising linked revenues for online content are unfortunately still not well established to bear the cost burden, service providers are missing the balance sheet equation for the service introduction.
Legal Hurdles – Content Rights for Online Distribution
Securing digital rights from partners, sports leagues, cable networks for multi platform streaming has been an issue of disconnect from the time TVE concept came into existence. While service providers view connected devices as yet another screen in the home with existing rights covering them, distributors argue the use case as an additional advertising real estate with implications on how content needs to be controlled and distributed. Last couple of months have seen several nasty fights among TV networks and service providers like Time Warner Cable and Viacom over iPad apps
and unfortunately they may not be the last on the theme. Although one can argue that online distribution/consumption of content is an addition eyeball/audience and hence programmers have a strong rationale for higher re-transmission fees and cost mark-up, MSOs with limited additional revenue from the service have reasons to worry
Growth of online content consumption through connected devices (tablets, smart phones, Smart TV etc.) has resulted in huge increase in IP video traffic requiring higher broadband speeds, additional bandwidth, infrastructure for content management and processing, re-modelling of ingest processes (content transcoding, near real time content availability, storage expansion, metadata aggregation, content categorization etc.) and security. Infrastructure requirements adds greater obligation for MSOs to cover online rights negotiations; authorization procedures; multiple device management issues; portal integration, content workflow, service provisioning and network management among others for success of TVE services
Networks today are spending heavily on large scale capacity upgrades, number of connected consumer devices are increasing, TVs are getting smarter and users are increasingly consuming content in online format. While it is still early to determine if TVE service offering can serve as the magic bullet against cord cutters or emerge as an significant revenue generating engine, there exists several technology and infrastructure challenges in TVE integration which has substantial financial implications with no absolute ROI in short term