How to effectively manage the challenge of OTT services in today's competitive market

Quality video streaming and an exceptional user experience on every device have become key differentiators. For this reason, “companies have the obligation to stand out from their competition by ensuring the best quality and speed in video delivery,” says Ian Munford, Director of Product and Enablement Marketing for the EMEA Region of Akamai, in this Tribune.

Whether you are a broadcaster delivering OTT (over-the-top) services, a specialist OTT provider, or a telecommunications company delivering online video, you are likely to find it increasingly difficult to differentiate yourself from the competition. This is because there is not much that separates one service from another in terms of programming and even price. Therefore, the quality of video streaming and an exceptional user experience on each device have become key differentiators. This means that the obligation for these companies to stand out from their competition is to ensure the best quality and speed of video delivery, a seamless experience on all devices and anywhere – and do it economically.

The reality is that this experience and quality are competitive advantages. To this end, most OTT providers prioritize their investments in areas such as high-definition video delivery, stereo sound, and application usability to meet consumer expectations. However, they often underestimate the challenge of delivering quality video in the process and therefore may be overlooking a prime opportunity to stand out.

To date, the consumer market had been forgiving of issues like video buffering. Today's consumers, however, are becoming increasingly accustomed to sophisticated multimedia experiences in various formats and places. The result is that they don't care about why the quality of an OTT service is anything but optimal – they only care about having an immersive, uninterrupted video streaming experience.

The value of quality video delivery

Video on demand (VOD) is quickly becoming a key part of our entertainment mix – especially on smart TVs. But as consumers begin to pay to access online video, they expect a broadcast-quality experience. Just as they have always shown little tolerance for poor online shopping experiences, they demonstrate frustration with poorly designed user interfaces for VOD sites (on any device), slow access to online video, and poor quality playback. In fact, a Accenture studio shows that 83% of digital consumers get bored when they experience TV interruptions due to poor broadband Internet connections at home. Poor streaming in today's hyperconnected world can have devastating effects. With so many options at their fingertips, consumers quickly abandon if they have a negative viewing experience – minimizing the likelihood that they will give the service in question a second chance.

Whether OTT companies offer subscription video on demand (SVOD) or transactional video on demand (TVOD), OTT providers need to deliver high-quality video streaming to remain relevant in this new market. This need to deliver broadcast-quality content is fueled by numerous trends including the propensity to view premium video on smart TVs and the growth of USB services/connected devices. As OTT services begin to replace traditional broadcast subscription services, viewers expect the same level of quality. This means that OTT service providers have to ensure that their videos play flawlessly, start quickly and are delivered without interruptions. It is not unusual for broadcasters to take different metrics into account.

Why it is difficult to deliver premium content online

The same Internet delivery challenges that have plagued organizations across industries for years have hampered efforts to consistently deliver broadcast-quality video online. Today, many OTT services tend to rebuffer video due to the unpredictable nature of the Internet and last-mile bandwidth connectivity to the consumer's device. As IP video is set to drive an unprecedented explosion in bandwidth usage between now and 2018, OTT video providers face even more challenges – and uncertainty.

The case of Wuaki

Wuaki.tv, an on-demand media provider, has effectively risen to the challenge of delivering quality online video streaming by working strategically and collaboratively with Akamai. Wuaki.tv offers content from a range of major content distributors – from Hollywood studios to local actors – allowing it to offer one of the most relevant and attractive video catalogs in Europe.

As Jordi Miró, CTO of Wuaki.tv, explains, "offering the best possible content and new services for our audience on a well-designed, high-performance platform is essential to the success of our business. But none of this would matter if we didn't have the quality."

To this end, Wuaki.tv has established a quality metric for its OTT service and is now able to directly relate improvements in online video quality to commercial success. Historically, Wuaki.tv had implemented a multi-CDN strategy.

It hosted its own origin and used multiple CDNs for delivery to ensure a level of autonomy and business continuity. When they analyzed the factors contributing to poor KPI metrics, they found that interdependencies and inconsistencies between different vendors were a major factor and turned to Akamai for help. The optimizations implemented by Wuaki.tv and Akamai improved their quality KPIs by more than 60%. As Jordi Miró explains, "after delivering its OTT video through Akamai's video CDN, Wuaki.tv has experienced a 60% improvement in these KPIs, producing a 25% increase in customer satisfaction and a 30% increase in revenue. In addition, the company enjoys increased customer support for its services."

As the OTT market matures, and higher quality online video formats (e.g. 4K and UltraHD) become the norm, the industry needs to rethink how it operates. Delivering quality streaming video has a direct impact on repeat business, revenue and consumer support. While the stakes are high, the challenges are also high – specifically, Internet congestion and latency along with delivery to multiple devices and platforms. However, as a reward for their investment in streaming video quality, OTT providers can expect lower viewer churn, higher viewer engagement, and higher viewer repeat rates, resulting in higher revenue.