Most publishers are familiar with the power and profitability of video
By Amitt Sharma
The successful launch of new streaming apps has changed the viewing landscape. Viewers today are flocking to a variety of mediums available to watch live as well as on-demand content. The pandemic changed the way people consumed media. There was a drastic shift to over-the-top (OTT) entertainment, making it a multi-billion-dollar industry in the country. This growth soon came into the spotlight and became a priority for many marketers as more advertising dollars flow to the platform.
There is also a rising awareness of the scope for linear-centric broadcasters to evolve their models and enhance online revenues. Most publishers are familiar with the power and profitability of video. Back in 2018, UK titles such as News UK predicted video revenue increases of up to 30%, while recent studies show video-driven yield grew 10.7% in 2020, despite fierce pandemic headwinds. Within the US itself, 64 million homes have adopted OTT services, garnering an average home viewing duration to 86 hours of OTT content per month. In the Indian context, according to a report by RBSA, the OTT market in India is expected to grow at a CAGR of 28.6% over the next four years. The industry has the potential to grow to be a US$ 15 billion industry over the next nine to 10 years. This also highlights that the era of cable television and TV commercials is on a decline.
Streaming media is what the viewers of today want. It is the new way of watching TV and video content. Interestingly, just as the OTT platforms are disrupting the traditional TV industry, OTT advertising is a new perspective that is reshaping the paid media landscape. However, this new sector requires certain techniques that will benefit digital media owners in the long run. It is also apparent that ad-supported streaming media delivery continues to be a major monetization strategy.
The varied techniques used today across OTT platforms include CSAI (Client-side ad insertion), wherein ads are directly loaded on the OTT box and then displayed to the audience. This technique has been used traditionally as it is much easier to create an ad-playback event using broadcast-standard triggers. Secondly, it is also a bit easier to deliver video-based ads separately to an end-user device ahead of time with CSAI than it is to integrate ads in between the primary content segments. This would mean that CSAI fits well for live events, such as breaking news and sports. The third benefit is ads could be delivered on a per-viewer basis to the client’s device, ad playback could be more finely targeted to a viewer’s demographic and geographic details, allowing a more diverse set of ads to be delivered. However, hacking issues are very common when using CSAI ad insertion techniques.
On the other hand, the SSAI (Smooth Stream ad insertion) process involves mixing ads and core content which is then streamed to the audience’s gadget in a smooth stream, frame-by-frame. The technique stitches the ads with the content which makes it free from the gaps that traditional CSAI ads had. There are hence no pauses between advertisements and videos. Additional features like clickable ads can later be added on the client’s end using certain advanced developments. However, SSAI, in the early days, suffered from technical deficiencies of stitching.
Nonetheless, this technique of measurement of ad delivery can both be confirmed and verified, based on how much of that single stream is consumed on the viewer’s device. There’s no longer a need to guess as to whether the ad served is played, which means that ad measurements are much more accurate between the advertiser and the content distribution platform.
The game changers
It would be right to say that the OTT platforms are exploring the realms of technology across not just artificial intelligence but other cutting-edge technology like machine learning and deep video analytics that goes into the whole process of streaming content seamlessly across platforms. Some of the key techniques used include Progressive Ad Server Technology, which is the acquisition of exhaustive control over impression goals, delivery speed, and frequency capping across all platforms. Publishers can create an advanced reader journey with automation that drives engagement and revenue; Blended ad stitching has control over what users see and optimizes the stream to contextually deliver high-quality ads to each available ad slot. And finally, the modern video tech for incremental revenue through a content delivery network (CDN) – where geographically distributed groups of servers work together to provide fast delivery of video content to all OTT and web publishers.
According to a KPMG report ‘The Digital First Journey’, while advertisement video on demand (AVOD) remains the primary source of monetization for the OTT players in the country, the subscription video on demand (SVOD) and Freemium models are also seeing traction, largely on the back of compelling content, including sports. Sponsored content has also emerged as an important monetization tool, with brands are baking in the advertising messages into the content itself.
The growth in monetisation though is partially held back due to challenges around digital viewership measurement and rampant content piracy which must be addressed to realize the true potential of OTT platforms and build a sustainable model in the future.
(The author is founder and CEO, VDO.AI. Views expressed are personal.)