Aggressive OTT Moves Abroad Are Test Beds for U.S. Strategists

Sam Blackman, CEO, Elemental

Sam Blackman, CEO, Elemental

November 3, 2011 – As U.S. TV programmers struggle to figure out how to monetize broadband distribution without cannibalizing their traditional subscription revenue streams, Europe is becoming a proving ground for new models that could ultimately come into play stateside.

In many instances new strategies underway across the Atlantic are the work of European-based programmers, as in the case of Eurosport’s new multiscreen over-the-top initiatives. In others the experimenters are U.S. powerhouses who have the freedom to test new models without worrying about fallout in relationships with service providers, as is the case with NBC Universal’s launch of a new multiscreen version of its VOD PictureBox service in the U.K.

“We’re seeing some very big names in the U.S. doing all sorts of pilot programs outside the U.S.,” says Alex Garcia-Tobar, CEO of SyncTV, supplier of a multiscreen publishing platform that has been chosen by NBC Universal to support its new U.K. service. “They don’t want to go down a path in the U.S. where their lucrative distribution process is completely disrupted. They’d rather test these models out in markets that are slightly smaller, slightly more controllable and learn lessons from that to bring back to the U.S.”

Most of this activity on the part of U.S. content owners is under wraps, but Garcia-Tobar says SyncTV is in a position to see what’s going on up close owing to its success at winning some of these new multiscreen business contracts. “This is in its infancy right now,” he says. “We’re going to see a lot of different models out there.”

NBC Universal is employing OTT distribution to extend its premium PictureBox service beyond the traditional TV outlets such as BT Vision, Virgin Media and others it has used since launching the VOD service in 2006. PictureBox Player, as the new service is called, is available on Samsung smart TVs and Apple iPads now and will be mapped to more devices in the future, the company says. PictureBox Player runs on the same rotating content schedule as the original PictureBox service, where at any given time 28 current and older films from the studio are available for on-demand viewing.

Technology advances making it easier to exploit OTT for delivering high-quality premium content in the context of all the formatting and transcoding hassles associated with multiscreen service are a big factor in program networks’ new initiatives.

In SyncTV’s case customers are leveraging a multiscreen publishing platform launched commercially at the outset of 2011 that was built expressly for these new service models, including backend support for subscription, advertising, per-view and other modes of monetization as well as support for the multi-formatting and streaming requirements. SyncTV has begun partnering with Harmonic, Inc., which, as reported previously (September, p. 19) has introduced new products to accommodate the encoding and transcoding requirements in next-gen OTT services.

Another supplier of multiscreen transcoding and related support technologies that has been instrumental in facilitating new initiatives is Elemental, which this summer won the contract for multiscreen transcoding of Comcast’s next-gen Xfinity service (September, p. 10). Now Elemental, which uses advanced processing engines to deliver multiple bit rates to suit multiple device formats, has scored wins with a number of additional content suppliers, including unnamed distributors for two countries’ online viewing of next summer’s Olympics and several suppliers of premium sports content in Europe and Latin America.

“Many broadcasters outside the U.S. are going to over-the-top simulcast of their primary linear services,” says Elemental CEO Sam Blackman. A case in point is Eurosport’s online distribution in France where the company is delivering both live and on-demand sports content to its viewing audience. “All video sports channels distributed over the top to Eurosport customers in France have to distribute the same exact channel online that they do on cable,” Blackman notes.

Eurosport, which broadcasts in 20 languages to 125 million homes in 59 countries, delivers content online to 15 million users per month from websites operating in 11 languages, including sites co-branded with Yahoo! in Germany, Spain, Italy and the U.K. Along with supporting multiscreen transcoding for live and time-shifted Eurosport channels in France,
Elemental will be working with the Eurosport/Yahoo! sites to deliver streamed content to multiple screens in countries served by those sites.

“With the processing power of Elemental’s solutions, Eurosport can quickly and economically expand content well beyond the 50,000 videos in our current library while improving video quality and increasing the number of live-to-Internet distribution feeds,” says Eurosport CIO Marc Amiot. “The Elemental platform lets Eurosport encode up to 12 different versions of Eurosport content and soon up to 16 supplementary event bonus feeds simultaneously, in formats compatible with PC, iPhone/iPad and connected TV.”

Eurosport parent TF1 Group of France is also employing Elemental Live, the firm’s platform for streaming live events, to create all the content delivered through MYTF1 portals, including most recently the complete Rugby World Cup matches for IPTV viewing in France. This required formatting of the satellite-feed from New Zealand, where the matches took place, into six outputs for six different service providers, each requiring unique settings for playback through end users’ set-top boxes.

“On the set-top box side in the IPTV space there are many different nuances that have to be satisfied by a streaming service for each service provider,” notes Keith Wymbs, vice president of marketing at Elemental. “We were the only vendor who could meet all the requirements for real-time live streaming of these events.”

Elemental also handled the Rugby World Cup online distribution needs for Deltratre, an international online distributor for many sports federations and broadcasters which provided highlight clips and other content from the games rather than streaming them live. This required feeding 22 outputs serving different locations over seven different platforms, notes Chris Catling, head of operations at deltratre media. “The pure speed at which we can do the encoding is faster than real-time,” Catling says. “This enables us to provide a superior service to our clients as well as a top-quality experience for viewers.”

Another instance where live streaming of a major event has moved to the multiscreen domain was the recent distribution of the Pan American Games from Guadalajara, Mexico to 17 countries by Terra, the Brazilian ISP that reaches 81 million monthly visitors across Latin America and the U.S. Using Elemental Live, Terra transcoded incoming HD and SD fiber optics and satellite feeds to six HD and 12 SD adaptive bit rate streams for streaming to computers, tablets and smartphones.

The platform also supported video overlay to enable on-the-fly image insertion into the outgoing video streams, says Terra engineering director Werner Michels. The move to Elemental allowed “us to extend our reach to more devices and to a larger audience than ever before,” Michels adds.

Such capabilities point to the ease with which big premium content distributors can now turn to OTT for distribution across national boundaries where multiple audio, captioning and other text outputs in different languages have to be synchronized with video across all the formats. “There’s a lot of technology that goes into taking captioning and subtitling and delivering across different platforms,” Blackman says. “Microsoft has one way of delivering captioning and subtitles, Apple and Adobe have different ways. And there’s a lot of work to be done around translation of metadata to all the feeds.”

And all this has to be done at costs per stream that offer some hope of ROI on these efforts. “As more streams go out the ability to leverage parallel processing and reduce the data server footprint becomes more important than ever,” Blackman notes. Of course, he adds, attaining quality levels suited to delivering high-value programming online is critical as well.

The fact that so many major players are leveraging new technology to knock down barriers to cost-effective OTT strategies points to the opportunities ahead for stateside networks. Now, with their own experimentation overseas while watching how others’ fare in this new space, big U.S. programmers have an opportunity to find out what works in the multiscreen space without risking upsetting too many apple carts in the process. But if the new paradigms turn out to be big revenue drivers, there’s no getting around the disruption that will ensue if they’re imported to the U.S.