The International Broadcaster Opportunity
If you’re a video publisher, your interest in IPTV surely spiked when you read that Netflix CEO Reed Hastings reported last July that the company streamed over one billion hours to its customers that month. Knowing that there are over 27 million U.S. Netflix customers as opposed to only 6.3 million overseas, it can be assumed that most of that streaming didn’t happen in places like Nigeria or Indonesia. Still, the Netflix numbers are inspiring and international broadcasters surely began to be think about distributing to IPTV hotspots outside of the U.S. IPTV, which is defined as video delivered to connected devices via Internet Protocol on a closed network, has to be part of any broadcaster’s strategy, but the challenges to international broadcasters are especially great.
A Fragmented World
Once you step beyond the Western IPTV monsters providers of Netflix and Hulu and hardware solutions like XBox and Roku, it becomes clear that, well, the path to IPTV distribution is anything but clear. Below we look at how users in the U.S., Japan, China, France, Germany, Italy and the UK connect devices to IPTV content.
Source: NPD DisplaySearch Quarterly Smart TV Usage Study, April 2013
In looking at the device usage, it’s clear that there is no standout hardware platform to chase. Game consoles appear to be in the lead in usage, but this metric fluctuates by region. For example, in China, OTT media center boxes lead with 23% whereas the UK sees more people using game consoles to consume TV media at 20%.
Chasing IPTV Users
Americans might be surprised to know that well over 40% of IPTV usage is happening in Asia. There is also explosive growth in Russia (ROS TV added 50,000 subscribers in one month in St. Petersburg alone) and the Middle East/North Africa region is expected to see 10X growth in paid IPTV subscriptions by 2014. However, figuring out where IPTV customers are, and are going to be, is only one piece of an effective international IPTV strategy. Below we lay out five steps that can help focus your international IPTV strategy:
1. Where to start? Find your sweet spot
Figuring out where to start distributing your content in the world of IPTV can be mind numbing. If you’re targeting the Western world, things are easy: you’d probably start by going after Netflix, Hulu and Roku. And if you’re feeling extra aggressive, develop for Google TV. But when you look at the global landscape, the playing field is a lot different. You have local TelCos that offer IPTV services. You have independent hardware manufacturers that are more than happy to distribute content to their custom OTT boxes. And, you have frontrunners like BesTV in China and MT in Russia who are massive growth. What platforms should you target first? The best thing to do is to take a step back and find markets and partners that represent your ‘sweet spot’ – the place where your mission, partner reach and content inventory intersect. Think about these buckets when figuring out where and how to distribute your content:
- Mission: As a publisher, you may have a mission to reach a particular population. Focusing on where these people are and what platforms they are using to connect to IPTV content can help you focus on where to start.
- Partner Reach: You may have found a partner that will make getting on an IPTV platform easy for you. They’ll ingest and encode your content, they’ll build you an app for their OTT box…you’ll be up and running in no time. However, this is the time to ask about this platform’s penetration and usage in your target market. Although the relationship sounds risk free, there are always updates and upkeep to think about. Go with the platform that has the largest reach to justify the work.
- Content Inventory: Early on, you should form a strategy around the content volume and mix you have available for your IPTV presence, but realize that requirements vary from partner to partner. Some platforms require 24/7 live feeds, others are happy with loops of content that make up the 24 hour cycle. Also, try to find out what type of content performs best for the market you are trying to reach and program appropriately.
2. Have a Marketing Plan
Once your content is on a platform, you will be competing with other publishers that want to capture the eyes of your potential audience. The sheer number of choices in IPTV environments can be daunting. Take a look at the number of channels that exist for these three platforms:
How does your channel stand out in a sea of hundreds? Having a marketing strategy can help. Trying to negotiate promotion with the platform provider is great place to start. Having your content front and center when users fire up their OTT box, for example, is worth its weight in gold. Also, think about the platforms you control that can help market your content on this new platform. Do you have available ad space on your Web site? Market the IPTV platform there. Same goes for available time on your radio, TV, mobile or print outlets.
3. Maximize Your Development Efforts
If you go ahead and develop your own app for IPTV platforms, take a good hard look at how your code can be repurposed for other platforms and devices. For example, can any of your code for a Google TV app be repurposed to drive an Android mobile phone app? Or, if you are programming primarily in HTML 5 for a particular partner, be sure to find out what other platforms require similar code so that you can reuse code and maximize your development efforts.
4. Diversify Your Content Distribution
IPTV is promising in many markets, but technology trends change rapidly, as do user habits. Don’t put all of your eggs in one platform basket. IPTV may be working in certain locations now, but users may, for example, move to mobile phone video viewing once mobile plan pricing changes. Or, bundling of IPTV delivery into existing technologies like traditional cable boxes may push users to abandon OTT devices. In short, stay alert and be aware of emerging trends.
5. Learn From Your Audience
When it comes to new platforms, metrics are your best friend. It’s imperative to not only monitor how much content your users are consuming, but also understanding what type of content they are consuming. Are they more inclined to watch short form content or long form? Is it hard news or lifestyle content? Also, be sure to watch metrics that are tied to major design elements. Are your users finding content? Are your navigation and search interfaces effective? Researching and iterating on your product is essential to your ultimate success.
RELATED: Download our IPTV: Opportunities and Challenges for International Media infographic (right click, save)
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