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One step ahead: how OTT players are staying competitive in a crowded market

Today, consumers set the rules of video – from the platform they use to the content options they want to watch, and on which device.

For many consumers, the concept of eagerly waiting a week to watch the next episode of a TV programme is now largely obsolete - unless, of course, we are talking about Game of Thrones or Mr. Sunshine. On top of this, consumers no longer have to tolerate multiple ad breaks. Instead, they pay a small subscription fee and watch their favorite content, on demand, with zero interruptions on services such as Hulu, iflix or Netflix.

This has led to a major increase in the revenue of the OTT market in Asia. According to Research and Markets, OTT revenues in Asia-Pacific are projected to climb to $42 billion in 2023; nearly triple the $15 billion recorded in 2017. For streaming to continue to build momentum as the dominant mode of broadcast, it’s crucial that consumers can enjoy a high-definition experience on their mobile phones. Yet it has traditionally been challenging for OTT providers in the region to deliver high-quality streams without delays or buffering.

However, as the OTT market in Asia becomes increasingly competitive, both international and regional players are seeking to provide customers with an optimum online experience to differentiate their service. Iflix has already recognized this. Despite already being one of Asia’s leading OTT players, thanks to its hyper-local content and competitive subscription fees, iflix knew that its growing subscriber base across emerging Asian markets would demand a high quality online experience that would rival the likes of Hulu or Netflix. For the streaming service provider, the answer consisted of deploying next-generation cloud technology that enables the delivery of TV shows, movies and sport in high definition video over low bandwidth mobile networks across the region.

This technology can help open new markets for service providers such as iflix. To put things in perspective, only 50 million people out of 600 million South Eastern Asian households have access to a reliable broadband service. For services based on live delivery of content over the internet, this is a real puzzle to solve: consumers want access to content using their own networks, no matter how limited or unstable they are. Otherwise, consumers will turn to a strong alternative to legal means: piracy. In Thailand, the issue is so prominent that the Asian Video Industry Association’s Coalition Against Piracy stated in a recent report that 45% of consumers have bought a TV box to stream or download content illegally – with two out of three of these consumers cancelling their subscription to a legal service.

While there will always be pirates and consumers who cut corners, providing a good quality of experience helps keep subscribers happy and hooked onto the programmes they love. Cloud technology provides a simple and effective way to improve the quality of the service, simply by reducing its reliance on fast broadband such as fibre optics and 4G, which are currently only available in mature APAC markets like Australia, China’s tier 1 cities, India’s megacities, Japan, South Korea or Taiwan. To put it simply, the technology takes a large file that will require a lot of data to stream, such as a film or a football game, and shrinks the amount of data to provide users with a broadcast-like quality stream of their favourite content, regardless of the quality of the network they have access to.

This adoption of the right technology for the whole region is giving iflix a major advantage. While many international players still developing price plans and regional content that are compatible with the Asian market, the Malaysian powerhouse has established a technological competitive edge and can now focus on extending its reach to more rural areas. And with more eyeballs, advertisers will soon see that there is greater ROI to be had from investing in OTT platforms to reach Millennials and generation Z’s, who are accelerating cord-cutting in favor of OTT services. As the quality between streams and traditional broadcasters becomes imperceptible, it is likely that more viewers will snip the cord. Consequently, we can expect more advertisers to take advantage of the opportunities OTT platforms provide, such as highly-targeted ads in a premium environment.

So, ultimately, while content and affordable price plans remain central to an OTT platform’s competitiveness, innovative technology that improves the consumer experience will help creative players of every size stand out from the crowd.

David Godfrey is VP and general manager APAC at Bitmovin.

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