OTT can benefit pay TV, says Sky Deutschland

OTT can benefit rather than threaten pay TV by enabling operators to extend their reach to multiscreen devices, with a business model that charges for content bundles rather than access via a specific technology making most sense, according to  Oliver Lewis, SVP, customer propositions, Sky Deutschland.

Taking part in a panel session at the Digital TV World Summit in London this morning, Lewis said that the proliferation of devices could only drive up the value of the subscription experience if operators developed experiences for these platforms properly. “Customers can now build up libraries of content that have been promoted to them. The flagship brands have the best opportunity to make the most of this,” he said, citing the example of high-value content such as Game of Thrones. “That’s the type of content that people will search for and consume,” he said.

Lewis said that there is a difference between Europe and the US, where Netflix had grown up as a pure OTT competitor to pay TV providers. In Europe, he said, the situation is much more blurred, with Netflix and others entering the market at the same time that traditional pay TV operators were investing in their own OTT platforms. Netflix has therefore been offered over pay TV platforms such as Virgin Media’s – a development that seemed surprising to US observers.

Lewis said that the addition of non-linear services had driven uptake of, for example, premium movie services since viewers could now get better value from those by watching films and series at a time of their own convenience. It made much more sense to make money from the “sale of content” than selling non-linear access separately.

Lewis said that rights negotiations to secure access to content across multiple devices had improved significantly.

Sky’s message to anyone it buys content from is that needs a “full suite of rights…because we need to achieve a degree of simplicity where everyone knows all content is available on all devices,” he said. This also means that content providers understand they should not ‘slice and dice’ linear and VoD rights between different platform operators.

“Everyone understands the value of exclusivity can be hugely diluted if someone else pops up selling an SVoD service,” he said.

In this context, Lewis pointed out that Sky has itself gone out of its way to cement its status as the home of the Bundesliga in Germany by doing a deal with Deutsche Telekom. He said that restricting the rights of any content to a particular infrastructure could harm pay TV development, which was one reason why Sky sought to secure exclusive rights to content across multiple platforms.