Broadband Communities

MAR-APR 2018

BROADBAND COMMUNITIES is the leading source of information on digital and broadband technologies for buildings and communities. Our editorial aims to accelerate the deployment of Fiber-To-The-Home and Fiber-To-The-Premises.

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M A R C H / A P R I L 2 0 1 8 | w w w. b r o a d b a n d c o m m u n i t i e s . c o m | B R O A D B A N D C O M M U N I T I E S | 6 1 e marketplace knows broadband is a mature industry. In fact, some experts say it is a plateauing industry. erefore, operators need to find new and innovative ways to add value to their services. e smartest way to tackle the market is to offer a video service coupled with high-speed broadband offering. For example, a cable or telecommunications provider may offer app-based video, including skinny bundles of national and local channels, a limited network DVR service, its own video on demand (VoD) content and universal search. is model encompasses everything consumers want. Viewers won't need to flee to V-MVPD services when they can get the high-speed internet they need for streaming and video at a highly discounted rate. Operators have a unique advantage in being able to market themselves with this strategy. MOVIE RENTALS: A HIDDEN SOURCE OF REVENUE Telecommunications operators often overlook the revenue potential of VoD movie rentals. Unlike typical OTT streaming services, which have a limited number of new release titles, most cable on-demand movie services get all the hit movies as soon as they enter the on-demand window. is business continues to thrive. e Digital Entertainment Group's 2017 year-end report noted that total home entertainment spending rose 5 percent to $20.5 billion, which included growth in electronic sell-through and interactive VoD. Video customers will find that cable operators are actually the best source for new release movies available in the market, as the leading OTT services focus the majority of their investments on original content and not on paying new release movie licensing fees. e data suggests that families are willing to pay for on-demand movies to watch in the comfort of their homes to avoid shelling out money for the high-cost in-theater movie experience. Further, customers are inclined to pay for subscription VoD to watch their favorite TV shows on premium networks such as HBO and SHOWTIME. is influx of revenue from purchased VoD fattens cable providers' wallets by capitalizing on consumer desire to watch the "latest and greatest" programming available in the marketplace. When movies are presented on newer services that deploy graphic- rich user interfaces and vibrant poster art, movie rental buy rates have actually increased by up to 30 percent, compared with legacy cable on-demand systems. For operators, the key is to offer easy-to-use, intuitive experiences that will keep their systems competitive with the popular streaming services. ALIGNING NEW BUSINESS MODELS WITH TRADITIONAL VIDEO OFFERINGS How can operators grow their video businesses? ey can engage with customers by investing in the back- office solutions that support multiple types of services (internet, video, IoT and so forth). Connected devices are the way of the future, so operators can set themselves up for success by future- proofing their business. Authentication of multiple services through a single interface enables ease and comfort of use. When providers align video systems with their other services, they save money and add value by delivering services they don't own. Operators are going app-based because they want to meet customer needs, knowing that customers enjoy Roku, Apple TV, Amazon Fire TV and similar services. Customers traditionally have an aversion to leased set-top boxes. However, a recent study shows that pay TV operators are largely shifting toward Android TV leased set-top boxes, which offer a managed platform that gives operators autonomy. is benefits consumers, who can call their providers' help lines and receive help instantly. is isn't the case for third-party streaming devices. CONCLUSION Operators are beginning to recognize the need to bridge gaps between high-speed internet offerings and next- generation video delivery. As operators strive to satiate consumers' growing need for the fastest, highest-quality connection speeds, they must also offer compelling video services that address and combat cord cutting. Telecommunications operators that offer video are the incumbents in the industry most likely to strike the best programming deals. erefore, they have the capability to offer bigger bundles of video content coupled with broadband – and the best deals overall. rough video platforms, operators can begin to recapture and grow their subscriber bases. e resources and products are available to these providers, enabling the traditional pay-TV industry to beat out new streaming OTT services with breadth and depth of content and next- generation video delivery with no buffering or delay. v Joel Tyus is senior product manager at Evolution Digital, a provider of cost- effective solutions for small to medium- sized operators. Learn more at www. evolutiondigital.com. The smartest way to tackle a declining broadband market is to offer a video service coupled with a high-speed broadband offering.

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