Scaling OTT: Do the economics stack up?

September 11, 2012  | Subscribers Only

Guy Bisson Guy Bisson Senior Director, Television Media

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OTT delivery of TV content is widely touted as the future of television as well as a disruptor of traditional platform-based pay television services. This view fails to take account of the current cost/benefit of delivering OTT with Unicast streaming and of the importance of platform ownership in benefitting from potential cost reductions from IP Multicast or network design. Platform-agnostic OTT services cannot be scaled at the current cost base to service the viewing demands of the average television viewer. Solutions for OTT provides risk removing many of the cost advantages that OTT providers offer over traditional pay TV.

Tables and charts included:

  • OTT is impacting traditional pay: but limited substitution;US net gain/loss in pay TV and OTT subscribers;Streaming volumes;CDN costs;Satellite broadcast;Terrestrial broadcast;Viewing cost analysis;SD satellite vs. SD stream (high quality);DTT HD MPEG4 vs HD stream (low quality);HD satellite vs. HD stream (high quality);SD satellite vs SD stream (low quality);HD satellite vs HD Stream (low quality);DTT HD MPEG2 vs SD stream (high quality);DTT SD MPEG4 vs SD stream (high quality);DTT HD MPEG4 vs HD stream (high quality);DTT SD MPEG2 vs SD stream (low quality);DTT HD MPEG 4 vs HD stream (low quality);CDN cost analysis ;UK: price to which CDN costs would have to fall to match satellite to reach nViewers;UK: price to which CDN costs would have to fall to match DTT MPEG 2 to reach nViewers;UK: price to which CDN costs would have to fall to match DTT MEPG4 to reach nViewers;Cost to meet daily viewing demand;Cost to meet annual UK viewing demand;Implied number of satellite channels that could be supported at same cost as serving UK population with Unicast

Pages: 15

Tables and charts: 26


Media research Bulletin

Guy Bisson

Senior Director, Television Media

As head of the IHS television department Guy directs all TV-related research and statistical modelling activities. Guy was instrumental in building the IHS TV research department and the online...

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