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InContext / An inside look at the business of digital content

What is OTT?

November 13, 2018 | By Dana Ghavami, CEO—Spotible @Spotible

Are you down with OTT?  Yeah, you know me.

O is for ‘Over’.  T is for ‘the’.  The last T? Well, it’s not that simple.

What exactly is the ‘Top’?  You probably haven’t heard two people define OTT alike. In fact, lately it has come to mean everything Other Than Traditional.

So, let’s start from the top, with a multiple-choice question:

What is OTT?

(a) STB: the set top box with your cable subscription and remote control using a private cable network also known as an MVPD (multichannel video programming distributor). These days, consumers can also stream their favorite content like Netflix via apps integrated with their STB. A lot of streaming content can also be accessed via Xbox and PlayStation gaming consoles that increasingly take centerstage in living rooms.

(b) STV: the smart TV.  No longer just a screen, these televisions are equipped with an operating system (e.g. Android TV) so that they can connect to the public Internet network and directly stream content.  Moreover, CTV (connected TV) streaming devices like Fire TV, Apple TV, Chromecast, and Roku, connect TVs to the Internet to stream consumers’ favorite content onto any TV no matter its IQ.

(c) iOS, Apple mobile Apps, and Android Apps on Google Play. These apps allow consumers to stream content on mobile phones anytime, anywhere. Users can also directly “cast” or project from a smartphone to televisions, which allows the mobile to serve as the new universal remote.  And let’s not forget how many people stream video over the Internet onto laptop, desktops, and tablet.

(d) All of the above.  Or, DTC- Direct to Consumer.  This is the right choice and what it’s all about.  Essentially, it’s all about the direct distribution of video content to consumers over the Internet, no matter how its accessed whether by streaming device, gaming console, Smart TV, mobile device, computer or STB. No cable company/private network required.

What’s not OTT

Often, there is confusion about PTV (Programmatic TV) — which is the enablement of digital data capabilities for greater audience insights than GRP (Gross Rating Points) and reports in real-time instead of months. There’s also its subset ATV (Addressable TV), which accomplishes one-to-one digital targeting capability.  PTV and ATV improve the targeting and reporting capabilities of both OTT and traditional linear TV.

For broadcasters and video creators, OTT offers a direct relationship (and possibly content subscriptions) with consumers outside of the cable TV universe.  But like OTT itself, the Internet-delivered video market is acronym-riddled and complex. A good grasp of the basics will help you understand the many opportunities ahead when viewership of various OTT video services will overtake traditional broadcast TV. This is predicted to happen within the next 5 years, according to a recent OTT Video Services Study.

In addition, revenues in the Global OTT market will increase to $18 billion in 2019, more than doubling the market from just three years ago.  This has massive implications not only for those who produce content, but for agencies, advertisers, and technology providers as well.  As companies in this space begin to assess how they will address this massive paradigm shift, it’s a good time to get familiar with the OTT opportunity.

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