By Taylor Riese, Managing Director, EMEA and India
The dawning of a new year is the perfect occasion for broadcasters to review and re-evaluate their over-the-top (OTT) TV strategies. For providers who serve Europe, this is especially prudent. More and more Europeans are turning to on-demand media for entertainment and information. As political shifts, like the uncertainty of Brexit and the rise of the yellow vest movement continue to make must-see news, European video consumption is likely to rise.
Currently, Europeans watch TV just 11 fewer minutes per day than Americans, making Europe one of the most valuable regions for OTT providers to set-up shop. However, the market is always evolving, and OTT providers need to be ready for the changes ahead. Here are three shifts that could dramatically alter the European OTT landscape in 2019.
According to Politico, Europe once lagged when it came to putting 5G infrastructure in place, but is now growing at a rapid pace. According to a recent report from Research and Markets, the once-dormant European 5G market is expected to increase by 141 percent by 2025.
The emergence of 5G will make European mobile quality noticeably better. Europeans are already following the global trend of increased mobile use; 5G capability will give providers more flexibility with their offerings and change the way consumers use their devices. For example, since 5G drastically increases the computing power that providers have to work with, they'll be able to deliver better viewing experiences, including improved augmented reality and virtual reality platforms on mobile. Another benefit of 5G is that it strengthens the average user's internet connection and makes it more efficient without as much data loss as 4G.
As 5G becomes available to more users in 2019, it's up to providers to pick a partner that is prepared to take advantage of the new opportunities 5G makes possible. OTT providers need to work with a content management system (CMS) that can not only deliver their content over a 5G-accessible platform but fully understands the technology. Only then can providers fully realize the advantages of 5G.
Cord-cutting is a major phenomenon in the United States, but, until recently, it wasn't something that caused European media providers to worry. According to the 2018 edition of the European Audiovisual Observatory Yearbook, instances of cord-cutting were lowest in Eastern European countries like Romania and are just now making a ripple in countries such as Norway and Denmark.
While the cord-cutting trend has been slower to catch on in Europe, that doesn't mean cable content providers can ignore the rise of OTT. More people in more countries are cutting the cord, beginning in Western Europe. According to the Yearbook, cable subscriptions are stagnating while video-on-demand made up three-quarters of growth between 2013 and 2017.
The slow ramp-up of cord-cutting isn't an excuse for European broadcasters to get set in their ways but to prepare carefully for the coming change. As more and more consumers cut the cord, providers should continue to invest in OTT platforms to ensure a flawless viewer experience. European providers already have a roadmap for change based on the cord-cutting behavior happening in the U.S., so there's no excuse for them to be caught off guard.
There was a time when the prevailing wisdom was for OTT providers to carefully patch together a content management system from a lot of custom solutions – one system for video streaming, another for content delivery, and so on. By now, however, most providers have realized that it's nearly impossible to make all the different software work well together.
In the tail end of 2018 and moving into 2019, providers in Europe are focusing on a more efficient solution: creating end-to-end platforms, even if it means conducting a merger or acquisition to make this happen. In November, European digital broadcaster Deltatre made headlines when it acquired Massive Interactive. Verizon Digital Media Services recognized the benefits of a holistic solution years ago. Our digital media platform is the industry's only end-to-end solution that can prepare, deliver, display, and monetize your content. It's turnkey. Simplifies your workflow. And it's all under one roof.
European providers should be looking for an OTT partner that can fit their business model both now and in the future. We can't fully predict where 2019 will take us, but one thing that's certain is the market won't remain in place. It's sure to evolve significantly over the coming year, and providers need a partner that can help them rise to the upcoming challenges to thrive.