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Emerging Market IPTV – This week many of the biggest television and film titans have been clobbered by investors leery of the potential demise of traditional pay TV to the tune of a brutal $60 billion in market cap lost.

  Perhaps counter-intuitively, this pivot bodes well for emerging market operators considering launching IPTV or video on demand services as part of multi-play bundles.  Here’s why.

The pace of change in even the last six months in the otherwise stubborn and immovable pay TV business has been nothing short of revolutionary.

What is an Emerging Market IPTV?

  Just like the music business before iTunes, major media powers including pay TV providers, TV network groups and top-flight studios generated unbelievable revenue while wielding near-total control of premium content distribution.

  Their gains from maintaining a profitable status quo did not make them evil but it did open the door for the new paradigm Netflix gleefully ushered in.

Emerging Market IPTV: How to Deliver Quality Content & Value

Emerging Market IPTV: How to Deliver Quality Content & Value

Now the revolution is ramping up exponentially thanks to premier networks such as CBS and HBO going straight-to-consumers even as they generate billions of dollars from pay TV and the explosion of uber high-quality alternative content platforms led, once again, by Netflix.

  Throw in growing consumer disdain for cookie-cutter, ever more expensive over-sized TV lineups and you have a recipe not just for market cap haircuts but also for dramatic change that will impact the global content business.

The reality is that because the world’s largest media conglomerates are often U.S. companies, what happens in the States spreads across the worldwide media landscape including developing markets.

New operators in fast-growing regions such as Africa will benefit as previously uninterested channel groups sideswiped by parent company stock downturns pursue additional revenue streams including secure wireless TV services in mobile-first or mobile-only locales.

  VOD services in Africa, Asia and relatively lagging countries such as Russia and Australia should witness premier content providers watching their market cap slump make more content available for third-party video on demand offerings.

  This is playing out in the States as Turner’s content revenue jumped 48% in last three months thanks to Turner’s new Hulu pact.

Caveats:

1) Pure-play traditional IPTV and VOD providers (those that only offer content services) will still face an uphill if not impossible battle against entrenched pay TV competitors as well as new market entrants that offer more compelling and profitable bundles including TV or VOD, wireless, broadband, home phone and more.

2) Multi-play operators must price and package to meet consumer demand and feature differentiating programming.

  Staid, cookie-cutter lineups with bloated pricing to match are a recipe for outright video services failure or never realizing the full potential of your valuable suite of products.

  Remember too that traditional TV packages will be bound by most-favored nation (MFN) agreements between existing operators and channel providers, likely resulting in those networks having less flexibility to introduce alternative price points and content tiers.

3) Pay TV and VOD providers still need to commit serious dollars to attractive content and marketing.

  A terrible library or TV offering is a losing proposition no matter how cheaply priced.

  “Serious dollars” will differ by territory.

  Real spending in South Africa will differ from Nigeria, will differ from Mozambique, will differ from Hong Kong, will differ from Russia and, most certainly, will diverge from the U.S. and Western Europe.

  But spending serious content dollars is non-negotiable in practically all corners of the world, as is marketing in keeping with whatever audience an operator seeks, especially in the face of successful incumbents and a litany of upstarts.

4) With the proliferation of more flexible and consumer-friendly video options, technical performance and user-experience are more mission-critical than ever.

  Robust technology includes ample capacity at peak viewing times, low latency, fast video starts, low truckroll/low customer involvement software and firmware upgrades facilitated by remote command, control and monitoring.

  Winning user-experiences absolutely must include TV Everywhere accessibility and user-interfaces that are at least on par with competitor offerings.

  More preferably, services would feature graphically-driven channel and video on demand guides, easy navigation and intuitive content discovery with, suffer the thought, some semblance of user customization.

Matrixstream has extensive emerging market expertise to help you win in the IPTV and VOD space, providing end-to-end service solutions including a one-vendor system and content services.

  Contact us to launch in as little as 90 days.

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