While the market for video entertainment has never been more vibrant — with excellent content available from a growing number of providers that resonates with both broad audiences and exquisitely defined niches — the factors that created opportunities have also seeded the challenges faced by the sector today.
The high consumer penetration of digital devices has combined with relatively low barriers for distributing video content to create a saturated market. A zero-sum race for subscribers’ attention and wallet share has emerged; the path to growth for most is to take market share from someone else.
In this context, over-the-top (OTT) streaming providers are exploring ways to create more engaging and interactive experiences with video entertainment content offerings. Engagement is increasingly seen as a way to protect their market position by reducing churn while creating new revenue-generating opportunities.
To better understand how the role of technology-enabled engagement strategies in the video entertainment sector will unfold over the coming months and years, we sat down with Serhad Doken, chief technology officer at Adeia.
Here is what he had to say:
Q: How are technology-enabled engagement strategies evolving in the video entertainment community?
Serhad Doken: TV and streaming services have historically been seen as passive experiences. However, as new offerings come online, content providers are reevaluating how they present content to differentiate themselves from their competitors.
This is especially important as the economic environment remains in an uncertain state. We have seen significant differences in user behavior emerge over the course of 2023 as consumers worry about their financial situation. It affects the streaming media sector as people look at their budgets and churn in and out of service provider subscriptions to save money.
End-user engagement is the key to addressing this phenomenon because it can contribute to: 1) establishing points of competitive differentiation; and 2) attracting and retaining subscribers. To be successful, however, the video entertainment community must develop new skillsets and competencies.
Effective engagement strategies require data collection, analysis and the utilization of intelligent technologies — such as AI and ML — to understand audiences and their preferences better.
Executed properly, these strategies can open new lines of dialog with end users and create higher levels of interactivity and intimacy. It also creates opportunities to establish and develop a sense of “digital community.”
Q: How are these digital communities being created?
Doken: As providers move down this path, some content providers are shifting their strategies by taking a page from initiatives pursued by gaming and social media companies. As a result, we are seeing a lot of experimentation.
Many OTT service providers are rolling out interactive features that offer subscribers more control over their experiences. For streaming services that depend on advertising revenues, this might include questions like: “Which ad would you like to watch?” or “Did you enjoy this?” The answers to these questions provide the basis for serving up content — including advertisements — aligned with the subscriber’s interests.
Some are taking the concept a step or two further. To create a sense of community and affinity, “group watch” features have emerged on several platforms. These technology-enabled services recreate the feeling of gathering in living rooms to watch content with friends and family.
Meanwhile, others are reverting to more traditional programming strategies by investing in new content — including episodic television and live streams — doled out on specific nights of the week to create “time-and-place” communities.
It harkens back to “must-see-TV” Thursdays when Seinfeld ruled the airwaves in broadcasting during the 90s or the debut of premium pay-TV episodes — like “Game of Thrones” a decade ago.
Programs like these often defined the next day’s conversations, creating a sense of community. In today’s context, these strategies offer the potential to stop — or slow down — strategic churn.
Q: What technologies are service providers embracing to make this happen?
Doken: Service providers are using a wide array of technologies to enable engagement — including video chat, text chat and even emojis — to bring common experiences to remotely located participants.
When these features are implemented, a tremendous amount of data about subscribers’ relationships with content and their service providers is generated. They also capture valuable insights into the social relationships digital viewing communities create.
To further monetize interactive engagement with consumers, service providers are integrating e-commerce capabilities that allow viewers to purchase — or bid — on items they see in the movies or shows they watch.
Success in these scenarios requires thoroughly understanding end-user preferences and desired engagement methods. It allows providers to create highly tailored content to attract and retain subscribers while offering the potential to generate additional revenue streams from directly selling ancillary products and services.
Q: What investments should OTT streaming service providers consider as they make go-to-market plans for the future?
Doken: In addition to developing skills and capabilities that blend e-commerce and content, companies should also focus on one more factor: gamification.
Gamification is one of the reasons Twitch — a service that focuses on live-streaming video games, including broadcasts of esports competitions — has been so successful. People enjoy watching other people play games. It is a proven strategy for securing engagement and creating a sense of community through interactivity.
Another area of technology that providers must focus on is connectivity. Interactive engagement requires access to high-speed, low-latency connections that reduce lags or disruptions that detract from the user experience across a community.
Connectivity — at wide-area networking and local-area networking levels — is also emerging as an essential factor for streaming live events, including sports and entertainment. Innovations on the broadband front will contribute to drastic changes in how consumers enjoy these experiences.
Up to now, consumers have had little control over how they access and interact with live sporting events. They simply consumed what directors and producers served up on their screens.
Over the coming months and years, new services will emerge, allowing users to control how and what they see on their TVs, tablets and mobile phones.
Work is underway to move beyond simply connecting viewers to the content captured and curated in outside broadcasting (OB) vans outside stadiums. As we move deeper into the decade, consumers themselves will be able to “produce” their own viewing experiences by picking and choosing what cameras they want to view and what audio feed they want to listen to.
Soccer is my favorite sport. When watching games that feature Lionel Messi, producers often organize their broadcast strategy by focusing on his role on the field. In the near future, interactive engagement technologies will make it possible for fans to observe all — or parts — of the game from the point of view of the goalkeeper or the coach’s sideline. Viewers will have an opportunity to choose the perspective they want for the game dynamically.
Getting all the relevant technologies to line up in real-time to deliver on this promise is challenging. It will require a very robust infrastructure, clever synchronization and the ability to adjust the streaming latency to make the experiences seamless.
If done correctly, however, it will doubtlessly improve engagement and create new and exciting consumer experiences and — again — generate new revenues for the video-entertainment ecosystem.
Q: What role is Adeia playing in supporting content providers?
Doken: Adeia has over 30 years of experience developing and licensing innovations that advance how people live, work and play. We approach every technology challenge from a full-ecosystem perspective — including content capture, delivery and rendering.
We look at all the different parts of the value chain to understand where current bottlenecks are and how new technological developments can bridge gaps to create new profitable offerings that will enhance the entire ecosystem.