Outlook 2017: Ostmodern - Will VOD deliver a new generation of content?
Tom Williams
Issue: January 1, 2017

Outlook 2017: Ostmodern - Will VOD deliver a new generation of content?

Tom Williams, co-founder and CEO at Ostmodern (www.ostmodern.co.uk) in London, discusses the themes that he and the team anticipate taking center-stage in 2017 across the Video On Demand space. Will it be the year for VR? Will the young continue to shy away from linear sport? And how will VOD companies adapt as customers move between contexts? Williams talks technology, content delivery, UI and more.
1 - Localisation as a competitive advantage
“Over the past years many local VOD providers have tried to change to be more like the big global companies (mostly by copying their UIs) and inevitably falling short. Those that have been successful have used the advantage of knowing their audiences’ viewing behaviours more intimately than a global provider ever will, or could. “On the other hand, the big globals have increasingly realised that they need to be more local because of the varying tastes of audiences across different regions.
Key point: “Next year, we're likely to see big companies trying to produce more local content, and the smaller local providers conversely trying to find ways to make UI more relevant to their local audiences.”
2 - Editorially Driven Experiences
“2016 has seen a deluge of content being produced and a fight for users’ attention. 2017 looks set to continue this trend. While this seems hugely beneficial for users, the issue becomes deciding which content is worth taking the time out of our busy days to watch. While Netflix looks to be leading the way with their clever recommendation engine, some users are becoming increasingly frustrated by it.
Key point: “In 2017, library depth will no longer be a competitive advantage for VOD products. The real winners will be the products which not only have good content, but those who can find clever ways of allowing users to navigate through it to find relevant content to watch.”
3 - Decline of live sport viewing among the young
“While live sport has always been considered by broadcasting companies to be the lynchpin of live TV, new studies have suggested that they don’t have the same appeal to the younger generation. As young people seem to be watching less live sport, broadcasters need to find better ways of engaging them and making sport content more relevant to them. One sports body trying to combat this change in behaviour is the NBA. 2016 has seen the NBA move to a new content distribution model, as they look to social media and other channels to give millennials short, ‘snackable’ content in places that already capture their attention.
Key point: “Broadcasters/content creators will have to fiercely adapt to accommodate how young people view sports. They will be much more creative about how they deliver first and second screen experiences, and combine these with social, for young people.”
4 - Niche audiences have new value
“Traditionally VOD providers have primarily targeted mainstream audiences, by providing a ‘catch-all’ experience. As the market has matured and accessibility to VOD has grown across the globe, the viability of catering specifically to niche audiences is emerging.
Key point: “2017 will see existing VOD services and new market entrants alike identifying and prioritising niche markets, which will create new opportunities for user acquisition and sustained retention in dedicated audiences.”
Content delivery
5 - Content skipping the cinema release
“More people are starting to expect films much sooner after their initial cinema release window. With Netflix releasing blockbuster films straight onto its service, and Sean Parker’s Screening Room gaining momentum in the film industry, 2017 could see the cinema business model challenged even more strongly.
“Smaller VOD services already provide this experience with day and date release already an accepted model for indie filmmakers through platforms such as BFI and Curzon.”
Key point: “We’re likely to see a growing sub-section of VOD services in 2017 that cater to home-release models, including exclusive partnerships between VOD providers, studios and production companies.”

6 - Content providers taking content back
“Companies which originally looked to distribute their content through as many channels as possible are now seeing lower value returns and are looking to take distribution back into their own hands by creating their own VOD services.
Key point: “In 2017, more content providers will be looking to go direct to the viewer, cutting out the go-betweens.”
7 - More intelligent connected experiences
“Providing connected experiences across devices has been an aspiration for VOD companies for a number of years, yet there is still much more for them to understand about how customers actually move between devices, and about the contexts in which they watch content.
“Customers vary in their needs: these depend on whether they are watching with their families or on the train to work, for example, but these needs also change as they move between contexts. SkyQ is a great example of an industry leader taking ‘Connected Experiences’ seriously.
Key point: “In 2017, VOD companies will dig deeper into the many different use cases of their customers and will become more adept at accommodating these use cases in their product evolution and specifications.”