Wednesday, May 30th, 2012
Melbourne, 30 May 2012. Despite their ever-increasing momentum, over-the-top (OTT) TV services are not yet an adequate alternative to traditional pay-TV, according to Ovum. However, operators should not rest easy, warns the Global analysts; besides enjoying significant brand equity, a handful of key OTT players can also leverage the financial strength and assets of their parent companies to substantially improve their positioning.

The first iteration of Ovum’s OTT TV Player Positioning research* – a dynamic tool objectively assessing key players within the Internet TV space – reveals that although OTT TV services now more closely resemble those of their network-based competitors, they have a long way to go before they can match the quality and breadth of content of traditional pay-TV offerings.

“While we expect OTT to become increasingly integral to the home video entertainment mix, there’s little evidence yet of consumers dropping their pay-TV subscriptions in favor of purely operator-independent solutions,” says Jonathan Doran, principal analyst at Ovum. “For the time being, OTT will remain a complement rather than an alternative to pay-TV.”

This is supported too by Ovum’s consumer insights research,** which shows that while half of consumers with connectible video devices are using OTT services to catch up on TV or watch movies, these services have yet to displace traditional forms of consumption, with 54% still subscribing to pay-TV services.

Ovum’s OTT TV Player Positioning research examines the disruptive impact of OTT player initiatives on the market. It looks at how traditional pay-TV operators will be affected, and outlines the potential for forming partnerships. “For their mutual benefit we believe it is paramount for operators and OTT players to collaborate, yet we have seen little evidence of this to date, with the notable exceptions of Xbox Live and Samsung,” comments Doran.

Elsewhere, the tool’s assessment of content service providers (CSPs) reveals that BBC achieved the highest overall score, outdoing other players in the areas of content attributes, consumer experience, and business environment. Samsung, meanwhile, emerged with the lowest CSP assessment positioning, receiving weaker scores for content attributes, consumer experience, and marketing.

“As competition in the TV services market hots up, there is a crucial need for clarity and guidance for all those involved. While traditional service providers must understand how new entrants are threatening their established revenue streams, OTT players also need greater direction to leverage partnerships that will enable them to deliver quality experiences, attract loyal consumers, and ultimately make money from TV services,” concludes Doran.



*OTT TV Player Positioning. The selection of players profiled is based on Ovum’s view of which companies are having significant impact on the evolution of the OTT TV space. The initial list consists of: Amazon, Apple, BBC, Google, Hulu, Netflix, Samsung, Sony, and Xbox Live.

The data and player profiles are updated on a quarterly basis, with refreshed KPIs as well the latest industry developments and announcements relating to the key players. The disruptive impact vs partnership potential analysis sections will be informed by developments and changes that have taken place during the previous quarter.

**Ovum’s Consumer Insights Survey is based on data obtained by a survey of more than 3,000 UK broadband users. The survey was conducted via a new interactive Internet-based platform developed by one of Ovum's survey partners. The questionnaire covered a range of topics related to broadband access and the connected home, including broadband speed satisfaction, important factors when choosing a broadband service provider, perceived issues around the home network, the range of connected devices currently in the home, uptake of connected home/broadband VAS services, impact of social networking on traditional digital communications, brand identity, and brand trust.

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Ovum provides clients with independent and objective analysis that enables them to make better business and technology decisions. Our research draws upon over 400,000 interviews a year with business and technology, telecoms and sourcing decision-makers, giving Ovum and our clients unparalleled insight not only into business requirements but also the technology that organisations must support. Ovum is an Informa business.
Jennifer Duraisingam
P: +61 3 9601 6723


Over-the-top (OTT) TV services are not yet an adequate alternative to traditional pay-TV, according to Ovum



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