OTT players discuss the disruption brought about by online platforms and how to monetise them. They also look at the challenges faced by digital media in the MENA region.
OTT players discuss the disruption brought about by online platforms and how to monetise them. They also look at the challenges faced by digital media in the MENA region
The second panel of the day discussed how OTT services have revolutionised the broadcast industry. Sponsored by Irdeto, this panel discussion was moderated by Christophe Firth, Principal, A.T. Kearney. The panel featured Maaz Sheikh, CEO, Starz Play Arabia; Olivier Dufour, Group Director of Digital at beIN Media Group; Nader Sobhan, Head of Middle East & North Africa, iflix; Fares Akkad, Head of Distribution and Digital Business Development, MBC Group; and Richard Frankland, VP Sales EMEA, Irdeto.
Christophe Firth opened the discussion by asking the panellists if the prevalence of OTT in the broadcast space is worthy of being termed a revolution.
Fares Akkad of MBC Group thought not, saying that although OTT is growing, especially in the on-demand space, it is not as dramatic as a lot of people think.
We view OTT as a continuation of the 360-degree experience we try to put around our content. There is coexistence of both and one will never take over the other. Live shows, news and sports will continue to be viewed on linear TV in real time, while several other shows give the viewer the flexibility to view them anywhere, anytime, he commented.
Maaz Sheikh of Starz Play said he sees an evolution of platforms based on age demographics and countries. Offering a personalised TV viewing experience is an attractive proposition, especially for the youth.
According to Sheikh, the challenge with OTT services is to deliver their offerings on the big screen through Chromecast, Apple TV, Samsung devices and so on. Having a robust platform to deliver an unhindered experience is a revolution in its own right.
In terms of age demographics in the 18-24 years bracket and 24-34 years bracket, there is an evolution, especially in this region, with many factors working in favour of VOD. You have 70% of the population under 30 years; you wont find that anywhere else in the world, said Sheikh, adding that device penetration is another factor contributing to this evolution.
He added that the biggest OTT operator, which has been very strong in the region for the last 10 years, is YouTube. Going by per capita consumption of YouTube in Saudi Arabia and the UAE, there is definitely a revolution. On a per capita basis, Saudi Arabia is number one in the world in YouTube video consumption.
Nader Sobhan of iflix, a subscription VOD platform based in Kuala Lumpur, which plans to set up base in the Middle East, said it is more about leapfrogging the platform than cord-cutting.
Its more about us providing the viewers with what they want than people cutting the cord. We will find more content to gravitate to different platforms and the pie is getting bigger, said Sobhan.
Firth then moved the panels attention to the monetisation aspect of OTT.
Richard Frankland of Irdeto said monetisation is difficult because viewers have been conditioned to receive OTT services for free.
Only 10% of pay-TV revenues will come from OTT. We are increasing the media pie but shrinking the revenue pie, because consumers expect not to pay for over-the-top services.
According to Sheikh, however, the shrinking of the revenue pie is a relative concept people are willing to pay for premium content.
Making premium and pay TV affordable is a challenge in this market, but it is also an opportunity. In emerging markets, the growth is going to come from premium content at an affordable price point. I dont see the pie shrinking.
Akkad said user behaviour and consumption habits are changing, which may be part of the evolution of viewing habits. He steered the discussion towards the role of social media and how it propels larger shows forward. He emphasised that big broadcasters will dominate the content space, while OTT and social media will offer the best of both worlds by engaging viewers in conversations beyond the prime-time shows.
Olivier Dufour of beIN Sports pointed out that his company has indirectly monetised OTT.
You can differentiate your OTT service by offering good quality content and a great user experience. If you have these, people will pay. We offer highlights in beIN Connect, shorten the 90-minute games and offer them as a standalone service as well as packaged with our linear TV offering.
On the best ways to reach the audience, Sobhan gave the example of iFlixs expansion in Asia and reiterated the importance of devising smart ways to distribute content. Sheikh agreed that intelligent distribution is the key to giving value to the customer.
Partnering with telcos is a great way to move forward in new territories. As for network optimisation and service delivery, CDNs are very strong and we work with Level 3 and Akamai, but in certain territories, we offload directly to the ISP as well, Sheikh said.
The three pillars of a successful OTT service, according to Sheikh, are partnerships with telcos, means of service delivery and method of payment. Sobhan agreed, but added that each market is different and there is no definitive formula for success. While iflix has partnered with multiple telcos in some markets, such as Malaysia, the service has tied up with just one telco in the Philippines and has no telco partnerships in Thailand.
Dufour noted that trust is the key to building a strong brand. Local electronic payment methods are not enough; we are actively expanding payment methods to penetrate different markets.
Frankland noted that OTT services need to be more innovative with their distribution strategy to expand their reach.
Cable providers are offering Netflix through set-top boxes in many territories, and they control the gateways to those consumers through their platforms.
Firth asked the panellists about ways to navigate a diverse market such as the MENA region, which is by no means a uniform territory and is quite complex. Akkad said MBC has been offering content that works across the lowest common denominator, which has worked in its favour.
There is no easy formula to talk to the whole MENA region. We have the big shows but need to be able to create local experience, which we have been doing successfully. The advertising in each territory is different too. OTT gives you flexibility in being more targeted in offering ads, he commented.
Firth, at this stage, drew the panellists attention to the menace of piracy. Alongside mainstream media and OTT, pirated content is also a part of the pie. Pirate users often pay for illegal subscriptions, so the actual spend on TV services is higher than it seems at first.
He set the ball rolling by saying: The common enemy for all is piracy. The battle against piracy in traditional pay TV is far from won, and now, the OTT world opens up new fronts and the threat becomes global. Are we prepared to face this?
Frankland said everybody is competing for eyeballs in the region. Services like MBC and beIN are actually competing against very sophisticated pirates, who have established OTT services with very advanced user interfaces and are competing for the same dollars.
To prove this point, Irdeto held a quiz at the end of this session and only a handful of people from among 300 attendees were able to identify legal services from pirated ones. Israel Esteban from beIN Media Group won a VR unit for correctly identifying the legal services.
Sobhan further added that the best way to fight piracy is to provide a better experience and an affordable price point. Providing a download function also makes a streaming service a valuable proposition for the user to watch in offline mode. iflix is offering this feature in several territories.
The panellists agreed that piracy should be countered with carrots, not sticks. Frankland noted that securing media assets using technology also works, and that the proliferation of services such as watermarking, especially for 4K content, is a move in the right direction.
Sheikh said that delivering content on time is extremely important to be able to win eyeballs. A lack of awareness of pirated content is another aspect that makes it difficult to tackle the issue.
The panellists concluded that collapsing release windows of new films and shows is very important to discourage piracy, as is offering localised, tailor-made content in an appealing and convenient way.
