Media Vision 2020 in review part 1: IP drives transformation of OTT delivery

January 9, 2020

Based on extensive statistical data, detailed surveys, and interviews with individuals, focus groups, industry participants and consumers, Ericsson’s Media Vision 2020 campaign – launched in 2014 – compiled six key predictions for 2020 for advanced markets, including Western Europe and USA. As the dawn of this new decade becomes a reality, what does the media landscape look like? In part one of this three-part blog series, MediaKind’s Meir Lehrer, Vice President, Portfolio Development, Arnaud Caron, Director, Portfolio Transformation, and Erik Ramberg, Vice President, Head of Global Business Development, look back on Ericsson’s 2020 predictions on broadband IP and OTT delivery and provide their take on where the industry is today.

Media Vision 2020 Prediction: “The Networked Society is realized.”

  • “5 billion video-enabled devices will be connected to broadband IP, transforming the consumption experience of TV.”

Arnaud Caron says: “In terms of cloud and media contribution workflows, I feel the overall transition to the cloud represents a big moment for content contribution and primary distribution applications. We will certainly start to see the effects throughout next year and 2021. The contribution and distribution area of our industry will benefit from fiber connectivity, particularly within the stadium and production environment, where there is less satellite distribution. Everything that relates to satellite distribution is moving increasingly towards IP distribution but there is still a necessity to have high bandwidth, uncompressed video, with low latency running on the fiber. This offers the requisite bandwidth – but still leaves the challenge of enabling IP distribution.

“So, the challenge for 2020 will be for the media industry to complete and embrace new, affordable standards. There is a further task in ensuring all the content and distribution sites that don’t have (or don’t need) satellite anymore; they need to be able to get the modularity of distribution across these various sites. This is where the cloud can come into its own by replacing satellite with fiber. Fiber will ultimately connect operators to servers in the cloud, thus removing the need for specific hardware. We will see the use of cloud hardware and cloud infrastructure in the way all contribution and distribution requirements are managed.  These cloud-based operations will enable consumers to enjoy a wider array of compelling services and access them at unprecedented speeds.”

Meir Lehrer says: “We all know ‘Content is King’, but when content goes from MPEG-2 to MPEG-4 to HEVC and 4K/UHD/8K, it’s clear the king can’t go anywhere unless his chariot can fit down the road! In short, networks globally will have to move to respond to more content of higher bitrates under more formats.

“This means wireline improvements (i.e. continued fiber upgrades and DOCSIS improvements) as well as, and most importantly, 5G rollouts. Nothing will drive more content delivery, storage and streaming to more subscribers (whether via a managed aggregating operator or via individual streaming services) than 5G. Bigger TV sets and more high-resolution content will be stuck in the starter gate without these improvements.”

Media Vision 2020 Prediction: OTT delivery for all.”

  • “Delivery of content over-the-top becomes applicable to all TV service providers or content owners as a way of reaching consumers and enhancing established broadcast delivery platforms.”

Erik Ramberg says: “I think we will see a number of providers deliver full video production in the cloud, including playout for key events. This doesn’t mean it will be totally efficient in terms of cost at this stage, but next year we will see it becoming technically viable, which will enable new entrants to be visible and deliver new, disruptive ideas to the market.

“On the other side, I think we will see more and more broadcasters offering a converged distribution model for live content – both in their linear and digital distribution. Over the next five years, we will see major changes from a technology and business implementation standpoint that will enable better scalability through convergence. In terms of linear content, this will offer greater flexibility and enhanced capabilities – replicating how today’s digital services are offering greater volume and value.

“The trend towards direct to consumer (DTC) content services shows no signs of abating either. It will likely accelerate as national media champions across each continent start to morph ‘basic’ OTT and catchup services into standalone, heavily monetized products. As we enter 2020, the sheer number of OTT services within each country will lead to subscriber churn pressure – even in mature markets.

“Take the US for example, which by the last count had over 200 OTT services. Although Netflix may be dominant in terms of subscribers, new entrants such as Disney+ are offering a tempting proposition for families with children, especially as the media conglomerate starts to restrict external licensing for big franchises such as Star Wars and Marvel.

“Moving into 2020, the opportunity for OTT service providers will come in relaxing their business requirements and allowing their content to surface and be discovered outside their walled garden. This could encourage an aggregator platform to emerge. If there was common ground in the industry or a method with which to publish a content catalog and convey the windows of availability, a modern aggregator could pull this content together and show what’s available across all of these services -giving value to the consumer by simplification of the experience.”

Click here to read the second part of our three-part series to learn more about our predictions for the rise of on-demand content and the emergence of new market entrants!