Omdia: overlapping ecosystems set to dominate in 2021

‘Overlapping ecosystems’ are set to play a growing role in the video distribution business next year in a trend accelerated by the COVID-19 pandemic, according to DTVE sister research outfit Omdia.

Platform, service and content owners are under similar pressures to become aggregators of content, according to a new Omdia predictions report, Trends to Watch: Media and Entertainment Super Trends.

Existing pressures on advertising and pay TV have quickly increased, while in mature markets, sources of new subscribers happy to accept standalone SVOD services are close to exhausted, according to report author Maria Rua Aguete, senior research director, TV, video and advertising at Omdia.

Unbundled services are coming under increasing competitive pressure, according to Omdia.

“With legacy services declining and increasingly functional OTT solutions (video and other), services providers must create and retain the best possible entertainment bundles, reaching outside the traditional provision of hardline and video,” said Rua Aguete.

Meanwhile, unbundled services are exhausting the available base of subscribers willing to accept standalone services.

While the COVID-19 pandemic has weakened advertising-supported channels, including basic pay TV channels, and benefited subscription VOD services, it has also meant that the latter are now having to fight harder to find new customers, giving added impetus to partnerships with fixed-line service providers and bunding, according to the report.

This means that SVOD services will increasingly be bundled with linear channels and with each other, while fixed-line service providers will increasingly look to become “agnostic providers of consumer services”, aggregating games, audio and video services.

According to Omdia research, partnerships between OTT providers and fixed-line operators expanded dramatically in 2016 and have been growing at more or less the same pace since, with Amazon and others increasingly driving new partnership growth as Netflix beds in with existing partners.

The number of major operator-OTT partnerships has now surpassed 600, according to Omdia’s count.