Consumers want video content that they can consume anywhere, on any platform at any time. The question is if telecoms operators have a bigger role to play in OTT video.
If you ask a consumer if they want to buy video services from a phone company, they’ll often say no and even add that they prefer not to buy phone services from a phone company. Customer experience from telecoms operators is often poor and consumers will not tolerate “Best Effort” when it comes to video.
Telecoms operators have watched Netflix, Amazon Prime and Hulu grow and they want a piece of this pie, especially since they own the physical network and have to continue to make investments in it. So far their play in OTT video has been a struggle.
Dutch operator KPN recently announced that it is ending its OTT TV service “KPN Play” from July 2nd this year. The operator said that this is due to insufficient demand for the service. It offered 25 linear TV channels, and on-demand content that was available for both iOS and Android. Launched in 2015, the platform has attracted less than 5,000 subscribers, according to Telecompaper.
The news follows another Dutch OTT TV provider Mobile2Morrow (M2M) closing its service on 1st May 2018. T-Mobile also made an announcement early this year about terminating its OTT TV service Knippr on 1st June 2018. It’s estimated that Knippr had less than 10,000 subscribers.
With OTT TV services being abandoned by Dutch operators, do other telco operators have a role in the future of OTT TV?
The Netherlands is a major European hub with around 50 OTT platforms. It’s the European base for Netflix which serves as a hub for 37 separate platforms across the region.
Netflix has more than doubled the number of subscribers in the Netherlands, from 1.1 million to 2.3 million, now reaching one in three Dutch homes, according to Telecompaper.
With its clean interface, recommendation system and subscription-based model, Netflix sets the bar high for how on-demand content should be available for consumers. It’s the leading OTT video brand. While accommodating to viewer experience, Netflix is also creating its own original content that takes the platform to capture and retain subscribers.
Changing consumer demand and growing competition means that telco-run OTT platforms need to find a way to market and differentiate their services or look at new ways to play in the space. Competing with Netflix no longer looks like a viable option and can be a costly mistake.