In this Q&A, Fredrik Engdahl who is Head of Commercial Operations at Magine Pro discusses the current state of the OTT industry, as well as the challenges and key opportunities for those looking to launch a new service.

What are the key opportunities for your customers in the current market environment?

The OTT market is showing tremendous growth, making it an extremely interesting time for new entrants and those already within the industry. We are now starting to see consumers subscribing to three or more OTT services, and although they are the smallest, they are also one of the fastest growing segments in the market. At Magine, we believe it’s a great opportunity for our clients to grab the number three or even four spot next to the OTT streaming incumbents such as Netflix, HBO, and Hulu.

In recent years, the viewer’s appetite to consume new types of independently produced content has also increased. And we’ve seen content production costs and content sourcing becoming less of a barrier for those looking to launch their own OTT service. We’re really seeing a democratizing of content distribution in the OTT market, and hopefully, we will see this trend accelerate in future.

What are the major technology drivers for the business going forward?

The foundations for global growth in OTT are now falling into place. In fact, we’ve seen increased investment and coverage of fixed and mobile infrastructure. Consumer data buckets are getting bigger and data even cheaper. Expansion of LTE networks and 5G roll-out will further expand the availability of data connections in existing and new markets for OTT streaming. This is particularly important for those considering launching their own OTT service, as consumers are now spending more time watching video content on their mobile devices than ever before. Mobile viewing is one of the biggest growth areas, and we expect to see this continue in coming years.

Traditionally OTT has proved most popular for linear TV and video-on-demand content. However, the demand to broadcast live events via OTT is on the rise. Previously the required hardware, distribution, and transport of live streams had been complex and unstable. This was a significant barrier for new market entrants as it resulted in negative customer experiences and lackluster live stream quality. With better delivery methods and new protocols for live streaming being experimented with and rolled out though, more OTT services are able to successfully deliver live to audiences globally at great quality and with little effort.

Another interesting development is the ongoing refinement of server-side dynamic ad insertion technology. Ad-supported OTT services are becoming a more viable alternative for OTT monetization. Services can better monetize their audience through ads with higher CPMs.

What are the biggest challenges new market entrants face along the way?

For our clients, securing content and distribution rights still remain as one of the biggest barriers, even though it has improved somewhat in recent years. It can be challenging to balance the cost of content with marketing alongside operating a sustainable service at a viable consumer price.

At Magine Pro, we leverage our years of experience in the consumer market to support our clients with content acquisition, marketing, and sales. We also put great time and effort into being at the industry forefront in regards to new technology, enabling us to offer the best and most innovative technologies to our clients.

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Meet Fredrik at IBC this September on the Magine stand 14.C25, and find out more about how Magine Pro can help you build and launch a successful OTT service. In the meantime, find out more about Magine Pro OTT solutions and services here.