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OTTVideo…FriendorFoe
PresentedbyScottMeyerMarketingDirectorInnovativeSystems
LocatedinMitchellSDVideoServices• IPTVMiddleware• InnoStream VODServerPlatform• 150SystemsinNorthAmerica
APMAX™VoiceServices• EnhancedHostedVoiceSolutions• SIPPhoneProvisioningandManagementSoftware• CallCenterRoutingandRecordingSoftware• 820APMAXSystemsDeployedinNorthAmerica
eLation™OSS• Billing• Financials• Staking&Mapping• ACSTR-069
OTTVideoWhatIsIt?
Theabilityforconsumerstowatchcontentwhentheywanttowatchit.Methods• ConsumerInitiatedRecording– STBcDVR• RestartTV• PauseLiveTV• VideoonDemand
- Transactional- SubscriptionVOD- CatchUp/JustMissedTV-- LocalEventVOD
WeBlewItWithVOD!L
• Developedin1992• FirstCommercialDeploymentin1993
• EarlyEquipmentandBandwidthCostswereProhibitive
• MoreContentandLowerCostsby2003
• VideoRentalMailorderbusinessinCalifornia– 1998
• 30Employeesand925DVDs• BeganVODoverInternetin2007• 2015SurveyofNetflixviewersrevealedover80%subscribetoitbecausetheypickwhattheywanttowatchwhentheywanttowatchit!
LegacyVideoProviders Netflix
RuralNorthAmericanSurveyConducted2016&2017
• ProveOutNetflixModel
• MeasureTimeShiftedViewingImpact
• GaugeConsumerKnowledgeinTimeShiftedTechnology
• DetermineConsumerInterestinTimeShiftedViewingOptions
Whywasthisneeded?
KeySurveyPoints• IndependentlyConducted
• OnlyRuralTelecomConsumers
• NorthAmericanSampling
• StrictlyaPhoneSurvey
• SurveyConductedandCompiledinJanuary2016andagaininJanuary2017
BoxScoring
• 1to10Scale• 1=Uninterested• 10=VeryInterested
BottomBox MiddleBox TopBox
1 2 3 4 5 6 7 8 9 10
ExecutiveSummary
•82%ofRuralHomeshaveSubscriptionVideoService•Only4%ofRuralHomesrelyExclusivelyonOver-The-TopContent
•DVRisin52%ofRuralHomes•20%WouldViewC3/CatchUPVODTodayifAvailable•16%WouldSubscribetoCloudDVR(cDVR)TodayifAvailable
•42%ofHomeshaveFIVEormoredevicesconnectedtotheInternet
0 10 20 30 40 50
NoTV
Antenna
OTTOnly
Cable
Satellite
Telco/PhoneCo.
THEIRVIDEOPROVIDERS
1%
7%
41%28%
13%
4%1%
4%
46%35%
6%
Surveyrespondentsdon’trecognizethattheirCableProviderisalsotheTelco
0
20
40
60
80
100
BottomBox
MiddleBox
TopBox
LOCALBROADCASTCHANNELSAREABIGDEAL!
85%
9%6%
87%
8%5%
RuralDVRSubscribers2016
DVR=Yes DVR=No
56%44%
RuralDVRSubscribers2017
DVR=Yes DVR=No
52%48%
0 5 10 15 20 250%
1-9% 10-19% 20-29% 30-39% 40-49% 50-59% 60-79%
80-100% Don'tKnow
TOTALTVDVRVIEWINGTIME RuralConsumersspendnearlytwiceasmuchtimeviewingtheirDVRsComparedtotheNielsonAverage!
13%12%
5% 11%9%4%
5%
9%2%
13%14%
21%17%
15%9%
7%
3%5%
020406080100
BottomBox
MiddleBox
TopBox
DVRADDONOPPORTUNITIES
72%
12%16% 13%7%
80%
010203040506070
BottomBox MiddleBox TopBox
CloudDVRisDesired!
16%
64%
20%
CaseStudy– Cloud/NetworkDVRValleyTel- Herried,SouthDakota• Cloud/NetworkDVROnly
• ExistingHomeDVR’shaveRecordFeatureDisabled
• TieredPricingBasedonStorageandRecordStreams
StantonTelecom–Stanton,Nebraska• Cloud/NetworkDVROnly– 1st RuralProviderinUStodothis
• StandardSTBsOnly• TieredPricingBasedonStorageandRecordStreams
Forbothproviderssavingsincapexandopex aswellasprotectionofconsumersrecordedcontentwerethedriversingoingtoanall-Cloud/NetworkDVRModel.
010203040506070
BottomBox MiddleBox TopBox
InterestinOn-DemandCatch-UpTV(C3VOD)
61%
20%19%
CaseStudy– VideoonDemand
MarquetteAdamsTelco– OxfordWI- InVODSince2010- 2500VideoSubs- FreeVODforAllSubscribers- TransactionalVOD- Vubiquity- C3– CatchUpVOD- LocalVOD
SubscriberslovetheirVOD!
- Averaging3000VODtransactionspermonth
- LocalVODContentTopDraw- MonthlyVODCostPerSub=
.45CentsUS
“WepayalotmoreforotherprogrammingandgetalotlessbangforourbuckthanwedowithourVOD” JerrySchneider- GM
TVsConnectedtotheInternet2016
DoesNotStreamVideotoTVStreamsVideototheirTV
23%
77%
• RokuTV• AppleTV• SonyPlayStations• TVswithIntegratedWebAccess
TVsConnectedtotheInternet2017
DoesNotStreamVideotoTVStreamsVideototheirTV
RokuTVAppleTVSonyPlayStations
66%
34%
0 5 10 15 20 25 30
1Hour
2Hours
3- 5Hours6 - 9Hours 10-14Hours
15-25Hours
26- 50Hours
Don'tKnow
HoursPerWeekRuralVideoConsumersUseaStreamingService
13%8%
22%
18%
7%28%
5%25%
6%
6%
5%4%
16%
21%
13%
5%
0 5 10 15 20 25 30
1to3
4
5to6
7to8
10to13
14to25
Don'tKnow
NumberofConnectedDevicesinHome
12%19%
13%
7%
24%
9%
4%6%
3%
7%9%
12%
1%
NotIntoVideo? • AmustforResidentialCLECOpps
• IncreasedVulnerabilitytoChurn
• SharedResources–Headend/Middleware
• VideoQualityisEssential
• MoreSpeedWILLbeRequiredinthenextFiveYears!
Summary
• RuralDVRConsumptionHigherthanNationalAverage
• ForRuralConsumersOTTStreamingisaComplementtoTraditionalPayTVnotaReplacement
• ConsumersAreReadyforCloudDVR
YourTimeShiftedVideoOptionsgiveCustomersa“Netflix”likeexperience!
• CustomersWantFreeCatch-UpTV(C3VOD)
• VODContentWillKeepThemonYourLinearVideoNetworkLonger
• TimeShiftedViewingReducesDemandonOTTWhichReducesTrafficonYourInternetConnections
UseTimeShiftedViewingOptionstoReduceChurn!
SummaryContinued
42,000NewVideoSubsQ12017!
ComcastisinvestinginthehardwareandsoftwarerequiredtobringIPtothelegacyTVexperienceandforthisreasontheyaregainingvideosubswhenothersarereportinglosses.
There’sOnly24HoursinaDay!
PleaseleaveyourBusinessCardorsendJenniferanemail
WouldYouLikeaCopyofthe50PageSurvey?
InnovativeSystemsVoiceandVideoSalesDirectorforTexasJenniferPavlicekjenniferp@innovsys.com