Bitmovin LIVE: NAB 2020 Kickoff Webinar - "COVID-19 and its impact on OTT Video"

April 15th
, 2020
COVID-19 and its
impact on OTT video
All rights reserved. © Bitmovin Inc 2020

bitmovin.com/live-nab

Todd Spangler
New York Digital Editor

“One in ﬁve people around the
globe are under lockdown.”
The Guardian, March 2020

“...Massive change in behavior.”
The New York Times, April 2020

“Most extensive global
collective action undertaken by
human beings in our history.”
The Telegraph, April 2020

All rights reserved. © Bitmovin Inc 2020All rights reserved. © Bitmovin Inc 2020All rights reserved. © Bitmovin Inc 2020
How does COVID-19 affect:
● Consumer OTT video consumption,
● OTT industry and market dynamics,
● Your business strategy, and
● Your technology decisions?

Our Moderator & Panelists
Todd Spangler
Variety, New
York Digital
Editor
Brian Fuhrer
Nielsen,
SVP Product
Strategy
Janet Balis
EY, Global Advisory
Leader, Media &
Entertainment
Iván Markman
Verizon Media,
Chief Business
Ofﬁcer
Stefan Lederer
Bitmovin,
CEO

Impact on Consumer
Video Streaming Behavior
1.
Brian Fuhrer
Nielsen,
SVP Product Strategy

Copyright © 2020 The Nielsen Company. Confidential and proprietary.
STREAMING METER INSIGHTS:
THE MACRO VIEW

13
Copyright©2020TheNielsenCompany.Conﬁdentialandproprietary.
STREAMING SHARE AND VOLUME
WEEKLY VS. YEAR AGO
Weekly, Persons 2+, Percent of Total Streaming Minutes
Source: Nielsen, Custom Streaming Meter Report, Sum of Daily Streaming Minutes (Weighted), P2+,Total Day, Others calculated as the difference between total
streaming and the sum of the major 4 digital publishers

14
STREAMING AUDIENCE COMPOSITION
WEEKLY VS. YEAR AGO
Weekly, Persons 2+, Total Streaming Minutes
Source: Nielsen, Custom Streaming Meter Report, Sum of Daily Streaming Minutes (Weighted), P2+,Total Day, Others calculated as the difference between total
streaming and the sum of the major 4 digital publishers

15
STREAMING SHARE OF TOTAL TV USAGE
WEEKLY VS. YEAR AGO - AMONG STREAMING CAPABLE HOMES
Weekly, Persons 2+, Streaming as a % of Total TV Usage
Source: Nielsen, Custom Streaming Meter Report cut back to OTT Capable Homes, Sum of Daily Streaming Minutes (Weighted) as a percent of Total TV Usage, P2+,Total Day, Based
on Streaming Capable Homes

Copyright © 2020 The Nielsen Company. Confidential and proprietary.
SVOD CONTENT RATINGS:
THE MICRO VIEW

17
Copyright©2020TheNielsenCompany.Confidentialandproprietary.
Source: SVOD Content Ratings, P2+ Projections (000), *Premiere Date includes Prior Day 12A-6A Nielsen Day viewing
PERSONS 2+ AVERAGE
AUDIENCE(000) BY DAY

18
Copyright©2020TheNielsenCompany.Confidentialandproprietary.
PERSONS 2+
REACH(000) BY DAY
Source: SVOD Content Ratings, P2+ Projections (000), *Premiere Date includes Prior Day 12A-6A Nielsen Day viewing

Industry & Market Dynamics
2.
Janet Balis
EY, Global Advisory
Leader, Media &
Entertainment

OTT usage before the crisis
OTT platform usage as a % of surveyed
households that utilize both SVOD and AVOD
services
Top 3 AVOD services in use as a % of surveyed households
YouTube
Facebook
Broadcast
network sites
71%
46%
27%
Source(s): EY analysis, SNL Kagan
Top 3 SVOD services in use as a % of surveyed households
Amazon Prime
Netﬂix
Hulu
61%
57%
30%

New services add intensity to a complex market
Launch dates and current announcements for selected streaming services
Nov 2019 Apr 2020 May 2020 TBD 2020
► SVOD – bundle offers with
Hulu & ESPN available
► 10 M+ subscribers since
launch
► SVOD – trial bundled with
new iPhones
► Limited set of original
programming available
► SVOD and AVOD options
available – can be bundled
with Xﬁnity
► Launch will likely remove
popular assets from Netﬂix
and other providers
available
► Content consists of
short-form videos meant
to be viewed on mobile in
bursts
► SVOD – likely offer bundles
with AT&T services
► Launch content includes
all Warner and HBO
properties
► Live news and sports
potentially in development
► SVOD
► Launch content to focus
on natural history
documentaries
► Niche subscription offers
forthcoming
available – details
forthcoming
► Enhancement of the CBS
All Access platform to
integrate across brands

COVID-19: Implications for consumer engagement
OTT services were already enjoying growth, as
traditional pay-TV services faced subscription churn
Subscription growth of select pay video services, 2015 – 2019 CAGR
The COVID-19 pandemic likely is changing the
dynamics around media consumption rapidly
*Note: Premium network subscriptions are inclusive of linear and OTT services
Source(s): EY analysis, SNL Kagan
Consumers seek entertainment options as
shelter-in-place orders keep them home
and try new things
Cable / telco providers and TV networks
offer free premium content
Lack of live sports and concerns over
negative news are driving consumers to
escapist content (e.g. scripted drama,
esports, video games)
109.7%
92.1%
56.0%
43.9%
27.8%
24.8%
8.7%
3.1%
-0.6%
-1.1%
-1.6%
-2.0%
-3.6%
-4.1%
-8.0%
-10.1%

Potential headwinds
ECONOMIC
UNCERTAINTY
COMPETITION FOR
CONSUMER ATTENTION
CONTENT PRODUCTION
DELAYS / HIATUS
*Note: Premium network subscriptions are inclusive of linear and OTT services
Source(s): EY analysis, SNL Kagan, Barclays
36%
Of surveyed consumers were
most likely to cut OTT
subscriptions ﬁrst should they
need to reduce expenses
Major OTT services with planned
launches are continuing on
schedule, adding intensity to an
already competitive marketplace
With most content production
on-hold, OTT services will have to
compete on the strength of
their existing libraries and
potential content acquisition
149
Planned originals in Q1 2020

What might this mean for the future?
SUBSCRIBER
GROWTH
Can OTT players become
great acquisition and
retention marketers?
SERVICE / OFFERING
CONSOLIDATION
Will economic pressures lead
to consolidation, fallout,
and M&A?
MONETIZATION
STRATEGIES
What is the right balance of
business models (e.g. SVOD,
AVOD, traditional distribution)?

Strategic tension between open and closed models
ConsumersDistribution
channels
DataBrand
experiences
ProducersTalent /
creatives
Monetization
Content production Distribution
Do we need to
license or produce
original content
versus acquiring
others’ content?
What is the model
for engaging with
content creators
and talent?
Who controls the
end-to-end user
experience?
Do we need more
1st
party data to
effectively drive
marketing? Are we
good at using data
strategically?
How do we balance
and sequence
direct and indirect
distribution?
Traditional and OTT
distribution?
How do we build
effective acquisition
and retention
marketing
capabilities?
What is the right mix of open and closed business models?

Impact on Content Distributors
3.
Iván Markman
Verizon Media,
Chief Business
Ofﬁcer

Connecting uniquely at scale
200B daily data
signals
̴900M global UVs
monthly1
30 trusted O&O
brands & partners
Diverse
insights.
Connected
channels.
Built for
brand safety.
Sources: comScore, Custom Report, US, Multi-platform, Verizon Media (and Microsoft Partnership): 1) Dec 2019;
2) Avg. January 2018 to September 2019, Global.

Delivering Billions of Experiences Daily
Sources: comScore, Custom Report, US, Multi-platform, Verizon Media (and Microsoft Partnership): 1) Dec 2019;
2) Avg. January 2018 to September 2019, Global.
4B
Video
Video streams
each month
3
Delivery
Exabytes
monthly
1.1B
Security
Blocked
attacks monthly
100Tbps
Network capacity
+
140PoPs
5K
Connections
6Continents
Verizon Media Platform

Customers Advertisers and
Agencies
Publishers
- Making news more
viable
- Revenue
diversiﬁcation
- Invention of new
business models and
offerings
- More inventory:
Streaming video
adoption up 60%
- More buying options:
by 2021 nearly 60% of
CTV ad will be sold
programmatically
- Better Measurement:
more ROI conﬁdence
- 77% of people said CV
content online has “no
impact on my feelings
towards the brand”
- 83% of people said
they are looking for
companies to take
leadership in the “stay
home” message

Things we’re doing now…
Impact of Live
Sports
Cancellations
Verizon Media Donates
Streaming Services to the
USO, Bringing
Entertainment to Service
Members Worldwide.
54% 60%Growth in
Gaming
134%Growth in Entertainment
(Disney, Hulu, FOX)
MoM Growth
in News

Impact on Streaming Tech
4.
Stefan Lederer
Bitmovin,
CEO

Streaming video consumption is increasing
Viewers are watching more
and are watching longer, but
data use is growing faster!

Impact on performance
Quality of service metrics suggest that video services can still cope
with the increase in load but see bandwidth related pressures

● There is extreme public pressure on content distributors to lower bandwidth
consumption while still delivering a positive experience for viewers.
● As providers see record levels of growth, they also need to ensure they are
managing costs appropriately as they scale.
Technology impact

Large opportunity for streaming improvements
40-50% Higher Efﬁciency
DEVICE SUPPORT FOR NEXT GENERATION CODECS

Large opportunity for streaming improvements
Advanced compression:
● Encoding: 3-Pass,
Multi-Codec, Per-Title
● Analytics: Data to optimize
in line with viewers’
streaming conditions
(Codec distribution, bitrates,
bandwidth, …)

All rights reserved. © Bitmovin Inc 2020All rights reserved. © Bitmovin Inc 2020All rights reserved. © Bitmovin Inc 2020
Technology Impacts, Key Points:
● Operators face unprecedented pressure to optimize
streaming due to COVID-19
● Consumer device support for high compression
codecs evolving faster than operator support
● Many “low hanging fruits” operators can
implement today that offer increased quality of
experience, lower bandwidth utilization and lower
total cost of ownership

Join for more sessions over the next 2 weeks
T E C H T A L K
Reducing
Peak Bandwidth
for OTT
Friday, April 17th

Join for more sessions over the next 2 weeks
T E C H T A L K
Quality of
Experience:
The Top 5 Metrics
That Matter
Tuesday, April 21st

Expert Perspectives
1. Changes in Viewer Behavior | Nielsen
2. Industry & Market Dynamics | EY
3. Content Distribution | Verizon Media
4. Technology Implications | Bitmovin
Summary

Bitmovin LIVE: NAB 2020 Kickoff Webinar - "COVID-19 and its impact on OTT Video"

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