Innovation will be imperative for North American pay-TV providers as new user preferences and behaviours, and increased competition for content further change the market dynamics, says research from NAGRA and MTM.
The report from the independent provider of content protection and multiscreen television solutions and the international research and strategy consultancy, The Pay-TV Innovation Landscape in North America, is the third white paper in a series exploring the innovations and strategies that will drive the next phase of growth for pay-TV operators.
The report confirmed that North American service providers are leading the way in introducing next-generation features, including 4K/Ultra HD (offered by 25%), content recommendations (35%) and voice control (10%). Diversification into adjacent business areas was found to be another big factor emphasising the region’s global leadership, with half of service providers offering home security and automation bundles to customers, mainly leveraging their own broadband infrastructure.
The report findings also revealed that app-based pay-TV and smart home solutions, followed by standalone over-the-top (OTT) services, new types of content offerings, advertising and data will be key areas for innovation and growth over the next five years. In addition, investment strategy priorities, content packaging and pricing, and user experience for integrated pay-TV and OTT platforms, will shape services.
Yet for all this, the report cautions that new challenges require a redoubled emphasis on innovation to adapt to intensifying competition for content and evolving consumer preferences and behaviours. It adds that service providers are adapting to a new on-demand and multiscreen environment, where the line between the core pay-TV offer and paid OTT TV proposition is blurring, while the need to generate new forms of revenues increases.
“It’s great to see that in a time of unprecedented changes in consumer behaviour the North American pay-TV market is consolidating its strength, while also targeting new key areas for further growth,” said Simon Trudelle, senior product marketing director for NAGRA. “However, service providers mustn’t rest on their laurels. As TV-product competition from new entrants intensifies, pay-TV service providers will have to accelerate innovation and time-to-market to create more value for their customers, with partnerships with vendors and multi-company collaborations set to become increasingly important.”
