As pay-TV and over-the-top (OTT) streaming service providers fight to retain customers through a challenging economic cycle, effective content navigation strategies have emerged as the key to improving audience engagement to prevent subscriber churn.
A recent survey by global insights firm, Interpret, notes that consumers are overwhelmed by the sheer volume of content available from streaming video providers. With the average viewer in the United States accessing up to five SVOD services a year, the majority also access multiple ad-supported or ad-funded linear and on-demand services. That’s a lot of content to navigate and manage, with over 20% of consumers believing they “subscribe to too many video streaming services.”
As a result, according to a recent Parks Associates study, over a third (36%) of OTT subscribers have become “service hoppers” — dynamically subscribing, unsubscribing and resubscribing to services multiple times over the course of the year.
We sat down with Dr. Mark Kokes, chief licensing officer at Adeia, to learn more about how cross-platform navigation will improve consumer engagement to reduce churn. Here is what he had to say.
Q: Thank you for taking the time to chat. Perhaps we could start with your assessment of content navigation today across the pay-TV and OTT streaming service provider community. What is the current state of this crucial engagement strategy, and how are consumers responding to what is available in the market?
Dr. Mark Kokes: Today, there is an exceptionally large number of content providers across the OTT and pay-TV space competing for consumer dollars that are being managed much more carefully today compared to 2020 or 2021 when consumers were sheltering in place through the COVID-19 pandemic.
As the market adjusts to the new economic realities in 2023, a fierce battle is underway for service providers to preserve their subscriber and viewership base.
In this context, significant progress has been made over the past few years to harness technologies to capture audience insights so that service providers — including OTT and pay-TV players — can help their customers navigate options and find content.
Most of these efforts, however, have been siloed. In other words, each service provider has developed its own personalization and recommendation solution because leaders in the industry see it as a key to maintaining relationships with their audiences and reducing the chances of churn.
It creates a problem for consumers because it makes it difficult — and even frustrating — to find the content they want without logging in and out of multiple apps on their connected TVs (CTVs), mobile phones and tablets.
The market is responding to this pain point. We are seeing more third-party providers explore ways to aggregate and gather data across devices and services to help consumers find and enjoy their desired experiences via mobile devices, connected televisions, cars and other devices.
Q: What can service providers do to address the frustration caused by content complexity?
Kokes: It is important to recognize that service providers come in different shapes and sizes. They are also constantly evolving as they adjust to the changing market landscape.
Pay-TV operators, for instance, have come a long way over the past decade. They play a far different role than when they were known simply as cable or telco companies offering content service packages through set-top boxes (STBs).
This market was famously disrupted by OTT streaming service providers — like Netflix, Amazon Prime, Hulu and others — encouraging the so-called “cord-cutter” movement.
Since then, demand for streaming has soared, prompting a massive influx of major new OTT players offering compelling content. The trend is raising the level of complexity — and cost — for consumers.
While consumers aren’t necessarily interested in returning to set-top-boxes, there is a growing desire for someone to aggregate and integrate experiences — including movies, episodic programs, cloud gaming, as well as emerging augmented and virtual reality offerings. It is in this context that pay-TV players — among others — are finding new opportunities.
Pay-TV players are shoring up their revenue streams by providing broadband and mobile services as well as serving up a content catalog that now frequently includes access to OTT offerings. These dynamics are reshaping the space and changing relationships between pay-TV and OTT service providers.
Q: What technology trends do you see contributing to better content navigation experiences?
Kokes: Emerging technologies — including big data analytics, machine learning and AI — are getting better at gathering, interpreting and predicting the needs and desires of target audiences for specific content. The real challenge lies in finding a way for those insights to be integrated across platforms.
Service providers across the entire ecosystem of pay-TV and OTT will need to think more broadly about what they can do to partner and get their content out to targeted audiences while retaining customers and keeping their acquisition costs under control. Cross-platform navigation plays a crucial role in addressing this imperative.
Q: What critical solutions can help service providers and their customers navigate the complex cross-platform, multi-provider environment?
Kokes: Technologies with search capacities and the ability to meaningfully target individuals and audiences based on multiple data sources in an open platform have significantly matured and provide a path to this desired future state.
In addition, synchronization-related technologies that can provide overlay services on top of existing live and on-demand content — like sporting events and episodic programs — will be a powerful driver in how this ecosystem develops over the next few years.
Q: Where do you see the next big frontiers of opportunity for enhancing the digital entertainment experiences of consumers?
Kokes: Entertainment consumption is driving innovation in numerous verticals. I think we will see new devices enter the market for AR/VR content, and I believe it will usher in a flurry of overlay opportunities–either improved data synchronization technologies that allow gaming applications on platforms that were previously known for film and episodic content or allow other forms of ‘gamification.’
Lastly, I think we’ll see enhancements in internet-of-things (IoT) applications, specifically in visual and auditory services, that will interact with everything from your television, computers, mobile devices, and even smart appliances within the home.
Q: What role does Adeia play in addressing these challenges?
Kokes: Adeia has a group of core offerings that can assist service providers, network operators, and pay-tv services in meeting emerging consumer entertainment needs by putting new — but proven — technologies to work to enhance the customer experience while protecting and driving new revenue streams. They include:
- Semiconductor technologies — With more content and higher levels of complexity comes the need for more powerful processing in the cloud — and on devices. Adeia is bringing hybrid bonding and node technologies to market, advancing the performance of chips that process multimedia content for delivery to entertainment platforms on the cloud and consumer devices;
- Networking technologies — Adeia is bringing to market bring more intelligence and operational capabilities that capture, integrate and operationalize data from multiple networking and streaming environments; and
- Data analytics — Adeia is developing analytical capabilities to help service providers target individual content viewing histories to present new content offerings in meaningful and concise ways while protecting consumers’ private information.
Those are just a few ways that Adeia contributes to this overall ecosystem.