Over-the-top (OTT) media services offered directly to viewers via the Internet, like Netflix, Disney+, Hulu, HBO Max, and countless others, have reached massive heights in recent years – the streaming industry was already valued at $110.1 billion in 2018. When Covid-19 swept the globe earlier this year, it came as no surprise when streaming rates skyrocketed – half of Americans increased video streaming by 50 percent during quarantine. And with this rise in streaming activity, came new opportunities for media services.
Disney+, which launched in Europe and the UK amid the lockdowns, is an early example of an OTT company that capitalized on streamers’ increased appetite and time for content consumption. The company doubled its subscribers to 50 million by April, a milestone which took Netflix seven years to reach.
But even with greater demand for streaming services, competition is fierce and not every streaming company can win. Few consumers have enough time or the willingness to spend on subscriptions to every OTT service out there.
The streaming wars have begun
To predict which services will win out, it comes down to four factors:
- Engaging and entertaining content
- Affordable price
- High-quality streaming experiences
- Wide distribution
With so many offerings competing for consumers’ attention, services need to nail each of these factors to earn a sustainable user base.
The content factor is well-covered – after all, most providers understand that fresh content is what makes the headlines and generates excitement. For instance, Netflix now frequently produces its own content, and HBO, already known for its top-notch content, recently launched HBO Max to expand its overall breadth.
As for price, Apple is a good example of a company that is honing in on this factor. It plans to roll out Apple One this fall, which will bundle several of its services, including TV, music, gaming and more, all for $6 a month.
Most consumers probably don’t think about the role IT infrastructure plays in their decision to choose one service over another, but this is the crux of the remaining two critical success factors: a high-quality streaming experience and the ability to reach a widely distributed audience.
Flexible networks choices for quality experience
Flexibility is key for businesses working to reach users at scale. Colocating services in a dense connectivity hub that provides access to a variety of ISPs, carriers, CDNs, and internet exchanges allows providers to connect to as many users as possible and save money while doing so. Having a collection of connectivity possibilities supports more resilient services by allowing providers to switch between whichever network can provide the strongest connection.
As a result, subscribers will receive the consistent cinematic experience they expect, whether they’re streaming on the road from a mobile device or sitting at home in front of their smart TV. Connectivity variety also allows for choices based on cost, which creates another edge for streaming companies competing to provide more for less.
Low-latency routes enable wide distribution
Operating as close to the end-user as possible also generates superior quality at better costs. Leveraging colocation centers maximizes market potential, as providers can place their growing mass of data closer to thriving consumer hubs, networks and clouds, creating low-latency routes between end-users and the data they need to stream.
Colocation can also extend the walls of the data center, interconnecting to other important regions where end-users reside, even if they are spread across the globe. By taking advantage of low-latency routes and strategic interconnection to thriving user bases, OTT media companies can expand their user-base while still reaching customers quickly and at lower costs.
The OTT media market is expected to generate $438.5 billion in revenue by 2026. Although it may seem like opportunities abound for these services, consumers are only willing to subscribe to the services with the best content and experience that can reach them wherever they are, and at the right price. As competition between these services continues to mount, colocation-driven quality and distribution could be a difference-maker in this race to the top.