The Evolution of Video Consumption

The way video has evolved makes it possible for more content owners, creators and distributors to deliver more content, to more platforms than ever before. We now have a new generation of pure over-the-top (OTT) providers, such as Netflix and Amazon. To compete many of the traditional broadcasters are launching OTT services of their own remaining relevant in this new landscape.

What this means for the consumer is a range of choice never before available; in terms of content, services, and viewing platforms. Alan Young, Chief Technical Officer at Encompass, points out, “the internet has had a massive influence on the video business and the entertainment business in general. Consumers want the content they want, on the device they want, when they want it.”

A very exciting trend is; consumers are very often signing up to multiple OTT services and getting an even wider choice of content. According to GfK, 16% of the viewing population in the US has more than one SVOD subscription. I believe we will see this continue, and of course, this trend is good news for video content owners and distributors, whether they are pure OTT or traditional broadcasters, as it means they are less likely - than feared - to lose their customers to competitors.

How Content is Distributed

The move to more OTT creates massive impact on content distribution methods. Young comments: “Previously satellite was the only way of distributing video. Now, it is one of the ways. Satellite still has some really strong characteristics when it comes to distributing video, one of those being that it is extremely reliable. That is one of the main reasons why nearly all of the broadcasters in the US rely on c-band satellite. It is extremely efficient if you want to send the same content at the same time, everywhere.”

As consumer appetite for TV everywhere increases, that is not always the case today, however, satellite still has a valuable role as part of the distribution chain. Many of us remember a time years ago, when the majority of traffic on satellite was telephony. Today, the majority of satellite traffic is video. 

Tom Johnson, Director Teleport Operations at Intelsat is seeing this sea-change from the satellite operators’ point of view: “Years gone by, we had a lot of point-to-point services for data and video. What we have been seeing over the last several years is that a lot of our customers are global. These customers are in multiple teleports and there seems to be an insatiable appetite for bandwidth, and hybrid network capability. The hybrid network supports the evolution and the secondary as well at tertiary demand.”

When it comes to the trend for OTT delivery, George Melton, Director of Engineering, Teleports at Turner Broadcasting sees it very much as a dynamic opportunity for Turner: “we are heavy into working with the newer OTT platforms. They are a partner, another distribution, just like we are part of the distribution chain. The more people we can reach, the more people watch, the more money we make, and that is good. Someone may be watching something on their iPhone or iPad, but the material may very well be coming from the teleport as one of the contribution chains, so the teleport is part of that chain and a very important one within Turner Broadcasting. It also provides a lot of opportunities, such as having remote monitoring capabilities, so it is really very exciting. We certainly don’t look at OTT as competition, we look at it as making more money and that is really what it gets down to.”

Technology Challenges

The evolution of video is not without its challenges. Young comments; ”most cable operators are now asking for the right to distribute content as an OTT channel, when renewing agreements with content providers.” While this is great news for the content owner, he continues: “however, the problem is that not all the content providers have 100% of the rights. You now have this problem where you have got to take your existing channel, which you spent an awful lot of money putting it together and making it look good, and you have got to chop out pieces of content, replacing it with something else, and you have got to do it at very low cost.”

At Encompass these days, each channel can now be marked frame accurately using industry standard SCTE markers for every element. Using those markers, the broadcaster can then accurately extract the right content at exactly the right moment. This is particularly important as it is being tasked with the challenge of producing multiple derivative services from one main channel for each customer, each wanting something slightly different. Now, with a more efficient and cost-effective method of doing this, customers are realizing that they can repurpose the feeds further still, for example by replacing national adverts with regional ones. This can even be done dynamically on the fly.

Monitoring content is also becoming increasingly important in this new era where content providers increasingly have more and more versions to distribute for each piece of content. Ensuring that content gets to the right place at the right time is more challenging than ever. I recently visited one client that uses Twitter to determine whether its content has made it successfully to the various distribution channels. They built a dashboard for feeds coming in from twitter, by looking at the geolocation of where the tweets have originated. This works fairly well, because people like to complain, so if people are not getting their video feeds, they will pretty soon complain about it on Twitter, so this provider is able to aggregate that information, bring it into the dashboard and learn from that.

Of course, that should be coupled with better monitoring before that point. Melton commented: “Hopefully I know about an outage before I hear about it on Twitter.” He puts a lot of emphasis on monitoring: “part of being more efficient is that you don’t need as many personnel, as you have automated systems. We have tremendous monitoring tools and there is zero tolerance for any types of outage.” Naturally, I need to interject that he uses Crystal’s monitoring solutions.

That zero tolerance approach is common across the industry today. Melton says that it is no longer like the old days, when an outage of five minutes would be acceptable, these days even five seconds will cost you eyeballs and dollars.

Infrastructure changes

These distribution challenges are also bringing about significant changes in the infrastructure, all the way down the chain.

At the satellite operator level, Johnson explains the end of life program at Intelsat: “it is a heavy CAPEX investment for us. We have an end of life program, where we are constantly monitoring the equipment to identify which pieces of equipment need replacing. What we are seeing is that there are a lot of new, and fast, changes with the video equipment. It is a challenge for us to identify these early changes or new products out there that can improve, for example, compression techniques or noise reduction. We are having to evolve and change all the time.”

At Encompass, there has also been a lot of capital invested in recent years. For Young, the CAPEX can be split into three categories: “growth capex is where we have a new customer and we need to invest to get them on board; maintenance CAPEX is what you need to do to keep the lights on and keep things running; and refresh CAPEX is where a customer is coming to the end of their contract and we need to do a refresh to keep them on board. We have just done a refresh for a major broadcaster at one of our teleports. It is not just the transmitters that get refreshed, it is everything, from the air conditioners to power.”

“We have started to use cloud-based or virtualized hardware. Now we are moving more towards an environment where we have a massive computing platform with lots of IP connectivity and storage, and we can put what we want on there. Instead of a CAPEX based model, we are moving towards an OPEX based model, because in five years, the equipment will be worthless.” 

The Future

The future will solve some of these challenges, with networks getting smarter and managing these multiple versions with ease. However, it will bring a number of other challenges. According to Young, one of the biggest ones is security. “Now everything is connected to the internet. Most vendors perform maintenance on systems by connecting to the internet, so there is a security issue there. We are starting to invest more and more time in how to make these networks secure.”

What is certain is that OTT is here to stay and all video content providers need to be negotiating the technical hurdles to deliver it if they want to remain competitive in today’s market.