When I think back to the Consumer Electronics Show (CES) earlier this month and what most stood out for me, two specific media trends come to mind. First, it was the huge buzz and public announcements pointing to the makings of a new landscape among content providers. This drove home the reality that if we think there are too many direct-to-consumer content players now — it’s only just begun. And each will need to find its audience and proper monetization approach.
The other thing I noted at CES? Ad tech innovation is surging.
These two trends are coming together in interesting ways – especially as consumers start to experience subscription fatigue from paying for too many services. This raises a dilemma. What do providers of video streaming services need to do to overcome subscription fatigue, reach wider audiences and grow revenue? Ads and/or bundling with communications service providers may help.
Overcoming an uptick in subscription fatigue
A new entrant to the mix, Quibi, leveraged CES to reveal details about their much-anticipated service, set to debut in April. For the uninitiated, the company produces short content (10 minutes or less) designed to be consumed on a mobile device, via a differentiated, new-format experience.
The big news is that Quibi will be offering consumers an ad-supported service for just $5 per month (or $8 per month for no ads) – essentially offering the same content via either a subscription video-on-demand (SVOD) or ad-supported video-on-demand (AVOD) model. The idea is hardly novel, but it does attempt to address the rising costs of content and subscription fatigue. But will customers willingly fork out $5 per month for ad-supported content on mobile devices?
Actually, many of Quibi’s initial users won’t have to, since they’ll be getting their service as part of their plan with T-Mobile US, as part of a distribution deal with that carrier.
More personalized, interactive ads
Quibi isn’t alone in relying on ads. Other video streaming services like HBO Max, NBC’s Peacock and many other services are also leveraging ads as part of their services. And ad tech advances will be there for them. For instance, AT&T’s Xandr wants to make advertising better for advertisers and consumers alike. The ad service will connect advertisers at scale to the people they want to reach. And it’s going to be “brand-safe” so that brands won’t have to worry about their ads being associated with questionable content or fringy content creators.
Beyond these examples, the event highlighted a slew of other innovators operating at the bleeding edge of ad-tech. In many cases, their goal is to make it easier to offer more personalized and addressable ads across streaming channels. Ad functionality is a case in point: you’re going to see more ads when you pause a show (Hulu has been using them for a while) – and they’re getting more dynamic too, with better click-through functionality on the horizon.
Finding an audience
Getting back to Quibi, the company is deploying a multi-pronged approach to attracting customers: low cost of service and joining carrier bundles to reach huge audiences. Ads let them keep their fees low, while also providing a way to monetize T-Mobile consumers, even beyond what they earn as part of their deal with the carrier.
But here’s the key: Quibi will reach an audience from day one. That’s the advantage of having a carrier bundling your OTT services. Plus, Quibi has the potential to streamline onboarding because T-Mobile uses Amdocs Media’s MarketONE. Without MarketONE, onboarding OTT services can take months. And even after onboarding is complete, the user experience may not be great, with some carriers unable to offer the seamless experience that going direct to the OTT provides.
Build an audience and monetize content. Faster.
What OTTs need is the ability to match their business with the right carriers and quickly onboard in a matter of days. OTTs can then immediately start reaching distribution agreements with carriers and not be bogged down by technical hurdles. It’s the fast lane to becoming part of a carrier bundle—and reaching millions of consumers.
Talk to Amdocs Media’s MarketONE team today about how you can reach more consumers faster. The Amdocs ecosystem extends to more than 350 communication service providers and 3+ billion end-users globally. OTT services too can now join that ecosystem.
Get started today with Amdocs Media's MarketONE.
About the author: Ian Zeifman leads product marketing for Identity & Commerce, Amdocs Media