Different types of OTT platforms serve different purposes. The most popular platforms allow you to watch your favorite TV shows on a wide range of connected devices. This was never possible with traditional cable TVs because of the technological limitations.
There are also platforms that can work on Mac, Windows, Android, or iOS systems and smart TVs. There are no longer any limitations to TV programming to cater to this fast-growing market. The flexibility provided by OTT platforms is unmatched. Despite its flexibility, vastness, scalability, and other advantages, there are still many challenges faced by these platforms.
Find out what these different challenges are and how many OTT platforms are turning them into opportunities and overcoming them.
The OTT Landscape
OTT platforms have seen the highest level of adoption by the younger population. This has been because of the flexibility and convenience it offers with regard to view movies and TV content across a wide range of devices. As already mentioned, this flexibility cannot be found with satellite and cable channels. Netflix, one of the earliest adopters of this technology, has been able to build a monthly active user base of almost 70 million in the US. Amazon Prime has 26 million Americans streaming videos.
One of the key features of OTT is that it has an individual-targeting model. It is the consumer that chooses the content, the time, and the device they want to access. This is much different than the one-to-many broadcast system used traditionally. Internet protocols are based on moving data point-to-point. This new technology can deliver content to a viewer, customized to their device and connection speed. It can also gather viewing information for advertising and promotional purposes.
Challenges Faced by OTT Platforms
Even before other challenges are discussed, it is important to realize that the biggest one is distribution. For example, content delivery over these platforms requires users to have TVs connected to the internet. This means that conventional TV sets need to be replaced with new internet-connected TVs, which are typically smart TVs.
Despite this challenge, most users are eager to pay this price, whether it is big or small for them, for all the convenience, quality content, and affordability that OTT platforms offer over the long-term. And the younger users are leading this bandwagon.
Some of the other noticeable challenges faced by OTT platforms are described as follows:
1. Bottleneck Checks
With the growth in OTT viewership, internet limitations have begun creating bottlenecks. The industry responded by moving content closer to users, which came to be known as the ‘edge’. This involved the use of private content distribution networks (CDNs).
Another related challenge was bandwidth choke points. This was resolved with the help of dynamic adaptive streaming over DASH/HTTP using concepts like:
- Apple HLS
- Adobe Dynamic Streaming
- Microsoft Smooth Streaming
These solutions rely on racks of servers for creating content versions at various bitrates, resolutions, and frame rates. Such content could be dynamically switched out based on the bandwidth available to the end-user device. At the same time, improvements were made in audio/video compression to enable lower bitrates, MPEG-H, HEVC, and other parameters.
There has been a growth in demand for videos of higher quality, especially in 4K, high frame rate, and high dynamic range. The new MPEG standards for HEVC, video, and VP9 (from Google) are capable of delivering 4K resolution at bit rates up to 20 Mbps.
With the growth in the load of video streaming over the internet, IP switches/routers have made adequate adjustments. They have increased the port line rate by 10Gbps to 25Gbps. Another development is the addition of more buffering for preventing packet loss.
When this is done, new challenges arise:
- Buffering can increase latency, which affects the quality of video delivery service
- Increasing port line rates means the need for internal router/switch bandwidth increases. The processing speed demand also increases.
2. Need for More Power
OTT platforms deal with high-resolution video data. This means there is a need for greater processing power, especially for compression. This further means a need for more fiber capacity, which can range from 10Gb to 100Gb. And this further comes with the demand for more energy.
The need for greater power, energy, and fiber capacity also creates a higher demand for storage capacity.
- There is a need for more storage for the additional versions that get generated
- Higher-capacity fiber connections mean special IP switches are required that could easily handle high line data rates
- This causes an increase in clock speeds, which further increases throughput latency
Many solutions have been considered to overcome these multiple and interconnected challenges. The use of multicasting technology is one solution. Multicasting is an IP protocol mode that makes use of reserved IP addresses for publishing a common data stream. It is finding increasing use for OTT platforms for internet delivery.
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3. Multicast Challenge
Another challenge OTT platforms face is the need for ISPs to support certain proprietary multicast protocols. Another related challenge is that multicasting requires either different versions of multicast streams for enabling DASH protocols or a one-size-fits-all approach based on a single video version. Globally, multicasts have 16.8 million IPv4 addresses. This may seem to be too much, but when a video stream has just 4 versions, there will be only 4.3 million simultaneous video streams. IPv6 multicast address has greater space and it will be some time before it becomes widely popular.
There is one more challenge related to multicast delivery. It is the need for a protocol for the distribution of the concept of a program guide across all devices. This is required to provide information on the specific video streams assigned to each multicast address.
The solution to this challenge is the use of P2P techniques. These techniques involve the use of edge terminal devices for communicating between all the edge devices and sharing data streams. This helps increase the availability of multiple processing nodes, individual bandwidths, and storage. This requires the user to rely on a specialized application capable of enabling P2P. Some of the P2P challenges include LAN congestion, security, and privacy.
4. Content Challenge
Content is at the heart of OTT platforms even when it may not seem like the most important factor in attracting viewers. It is also true that if these services are unable to create and provide the content desired by viewers, they cannot be successful in the long term.
Providing niche content is an excellent opportunity for overcoming this challenge. Examples of content providers that have excelled in the area of creating niche content include WWE and Crunchyroll. CuriosityStream and Dramafever were so successful with this solution that they caused the behemoth Netflix’s market share to come down by a staggering 50% at a time.
So what does niche content mean? It is all about avoiding the trap of creating generic content. It involves providing something unique and different to viewers.
5. Content Discovery
Viewers no longer have the patience to browse through hundreds of channels to find something they may like watching. The modern consumer wants to find the required content after browsing through no more than a couple of pages. This makes it important for OTT platforms to enhance their content discovery functionality.
These platforms should leverage applications that can identify viewer preferences and habits. Such applications should be able to personalize the viewer experience. A unique aspect is that viewers tend to stick with a service that provides personalized content suggestions, which is simpler to use and faster to find the content of interest.
6. Meeting Demand
It is almost always difficult to tell what content can go viral. If and when a video content becomes viral, OTT platforms can find themselves to be unprepared for it.
There is always the chance that a piece of content can get millions of views in a short period of time, sometimes in a day or two. Services should have the scale of provision to be able to handle such demand. This refers to the servers and supported bandwidth, all in place to prevent any situation of crashes. The failure to stream the 2014 Academy Awards event live is one of the best examples of such a failure.
7. Viewer Retention
Retaining the viewer base is a major challenge facing OTT platforms. The different concerns in this regard include:
- Offering what content viewers want
- Providing high-quality video content
- Advertising content should be non-intrusive and allows viewers to skip it
It has been found that intrusive promotional content and low video quality are the major reasons viewers move away from certain content. So it is important to address these issues to increase viewer retention.
The OTT space continues to become crowded. OTT services have to work harder to create and deliver content and follow policies that not only attract new viewers but retain the existing ones. This is not just about delivering greater content, but also about providing a better overall experience.
There are many more challenges OTT platforms and players are facing. Reaching the global market and overcoming the multi-device viewing challenge are still big concerns. Then there are business, societal, and legal challenges. In fact, true live streaming is still a challenge for popular content like news, sports, and entertainment events. It requires the lowest-possible latency and handling tens of millions of viewers at the same time while delivering high-quality audio-video content.
OTT has certainly created new opportunities for distributing content to viewers in any market. On the other side, viewers have their own choice of choosing the programs and the flexibility of when, how, and where to watch their favorite content. As OTT continues to gain popularity, the IP technologies underlying the Internet will have to evolve. It is, however, a big challenge because these technologies are not simple to scale. Thus, there are still many challenges that continue to persist in this space which will further evolve into newer opportunities in the coming years.