Consumer Insights Practice

Market Intelligence on Buyer

Behaviors, Consumer Attitudes, Brand

Preferences, and Emerging Behaviors

UX Practice

Design Guidance and Competitive

Intelligence on User Experiences

and Opportunities for Innovation

Syndicated Services

& Consulting

Insights, Information,

Forecasts, and Consulting on

Companies, Brands, Products,

and Technologies Competing

for the Consumer

AppOptix

Intelligence on

Consumer Activities,

Behavioral Patterns,

and Usage Profiles

through Big Data

Analytics

Strategy Analytics: Delivering insights and recommendations that lead to business actions

November 8, 2016 Strategy Analytics, Inc 2

Traditional Distribution Channel Emerging Distribution Channel

Broadcast Networks

TV Packager

Content Owners/

Producers

Cable Infrastructure

Satellite Infrastructure

Terrestrial Infrastructure

Telecom Infrastructure

Pay-TV Packager Website/App

Broadcast Network Website/App

Third Party Website/App

Content Owner Website/App

STB

TV Set

DVR

Tablet

PC

Smart TV

Mobile Handset

Smartphone

Internet

Devices Delivery Service Packaging Content Aggregation Content Production

The consumer media and technology value chain and the

transition to internet video

Connected TV Device

OTT = New Revenue Opportunities

… $84Bn in 2020

• OTT revenues grew 29% to reach $34.0bn in 2015

– 45% advertising

– 31% SVOD

• Market will grow at 14.7% CAAGR thru 2021

– Ad share will reach 48%

– TVOD (digital rental) share will decline to 6%

OTT = Cord Cutting

… but Not Much

OTT becomes TV… which becomes OTT

• Netflix becoming integral to Pay TV operators

– Acquiring and producing content – Partnering with numerous cable TV providers

globally (25+ operators) – Helping smaller operators expand VOD Library – Dish Network – Integrated Netflix as a “channel” in

their EPG – FreeView lists Netflix, Now TV as “Pay TV” options – Becoming more common to see Netflix and other

OTT services as apps in the SP user experience

• Pay TV operators launching OTT services – Sky – Now TV – Dish Network – Sling TV – Comcast Stream, Verizon, Cox, CenturyLink

• Content owners go direct-to-consumer – HBO, Showtime – CBS, HGTV, etc.

OTT Challenges and Actions for Industry Players

Thank you

David Mercer VP, Digital Consumer Practice

STRATEGY ANALYTICS Bank House, 171 Midsummer Blvd

Milton Keynes, MK9 1EB, UK

Direct: +44 1908 423610 dmercer@strategyanalytics.com

Twitter: @DavidMercer_SA