The traditional pay TV market is rapidly evolving, creating a wealth of new opportunities – and a few dangers – for large established players, up-and-coming operators, and new entrants alike.
The reason? Internet technology has reached higher ground. This enables ISPs, telcos, and many other companies to jump on board the TV provider game. Even content providers are turning to OTT services, which is only adding fuel to an already red-hot market.
Pay TV providers – new and veteran – are challenged, however. How to differentiate services in such a crowded market? And with content prices high and competition stiff, even if they can differentiate – can they make money in the process?
TV Experience – Differentiator AND Revenue-Generator
In an era of ubiquitous, increasingly productive and user-friendly mobile platforms – TV experience is unquestionably the new differentiator for Pay TV services.
The good news is that a cutting-edge Pay TV experience isn’t just a differentiator – it’s a revenue generator with measurable ROI.
So, how can pay TV operators turn user experience into revenue?
- Through social media integration – Seamless integration with user social media accounts means that providers extend their reach, and their revenues, virally. For example, one viewer generates $X by watching premium VOD content. But when that viewer shares her positive experience, or even better, actively invites her friends to watch the content with her in real time – how much more potential revenue could this generate? What if she is incentivized to share, with the offer of the next VOD item free?
- Through deep user engagement – When users are watching, they are engaged. The deeper the engagement, the greater the suggestibility. And – as any good retailer knows – suggestibility translates into purchases. Is your user watching a baseball game? Deepen his engagement by offering on-screen access to live team and player stats, drawn from updated online sources. Then offer him immediate, one-click access to team merchandise, on-screen, as he’s watching, leveraging his on-file credit card or user billing account for payment. While you’re at it, let him order his favorite takeaway food, on-screen, without leaving the sofa or even putting down the remote. Each of these examples represents a whole new revenue stream for Pay TV providers.
- Through more effective and targeted advertising – TV advertising is notoriously expensive and non-specific. Web-based advertising is more cost-effective, and shows clearer and more measurable ROI. Once you know your viewers through any connected channel, personalized advertising is just a small step away. Hitting known viewers with the right messages at the right time and offering them immediate click-to-action options – this translates into markedly greater advertising revenues for providers, and sales for advertisers. It’s win-win.
Today’s Pay TV revenue models need to go far beyond traditional subscription fees and transactional VOD. The above are just a few examples of how forward-thinking Pay TV providers can turn advanced technological solutions into market differentiators and revenue generators. The advent of viable Internet-based services – and especially the revenue generation opportunities they present – should be welcomed and embraced by operators large and small.