Smaller TV Channels Could Go OTT-Only

Jan. 31, 2013
According to IHS iSuppli, for many individual channels that have small- or medium-sized audiences, a switch to over-the-top (OTT) streaming as their sole means of video delivery could become an option over the long term. However, it's currently not cost effectiv...
According to IHS iSuppli, for many individual channels that have small- or medium-sized audiences, a switch to over-the-top (OTT) streaming as their sole means of video delivery could become an option over the long term. However, it's currently not cost effective for TV channels with large numbers of viewers to move to OTT-only video delivery.An analysis of the U.K. TV market indicates that about two-thirds of the country's major channels potentially could afford to switch to a unicast OTT-only delivery model five to 10 years in the future. Of the 192 channels rated by the Broadcasters' Audience Research Board (BARB), only 58 have such large audiences that moving to a pure-OTT approach would be cost ineffective for the foreseeable future."For large consumption channels - i.e., channels with large audiences - the economics of OTT streaming remain highly unfavorable, with the cost in some cases hundreds of times greater than broadcast on satellite," said Guy Bisson, research director for television at IHS. "However, for channels with a low to medium viewing share, scaling for OTT may not be such an issue. It's true that high-definition (HD) makes OTT unaffordable for any channel regardless of its audience size, and that any discussion of moving away from traditional satellite, cable and terrestrial and to OTT is academic at the current time. Nonetheless, as television business models change and subscribers' viewing habits evolve, there could be a gradual move among smaller SD channels to begin to investigate OTT unicast and multicast as a substitute for traditional broadcast during the next decade."

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