In case you needed any further reminder of OTT’s importance to the future of the entertainment industry, AT&T this week announced plans for an ambitious streaming service that will build on the scale achieved via its merger with Time Warner.
The service, which is slated to launch in the fourth quarter of 2019, promises to go head-to-head with established subscription video-on-demand giant like Netflix and Amazon Prime – as well as new entrants into the market from the likes of Disney and Apple.
On the back of its blockbuster US$85 billion acquisition of Time Warner, which closed in June, the AT&T product will leverage the WarnerMedia assets – which include HBO, Turner and Warner Bros.
WarnerMedia CEO John Stankey said in a statement that the service will serve as a compliment to its existing businesses and will offer “a new choice for entertainment with the WarnerMedia collection of films, television series, libraries, documentaries and animation loved by consumers around the world.”
In an internal memo published by CNN, which is part of Turner, Stankey added that the service will start with HBO content, with Turner and Warner Bros’ output to be packaged on top. The move promises to bundle together a broad range of content including blockbuster series like Game of Thrones and Westworld with movie franchises like Harry Potter and the DC superhero films.
With consolidation the flavour of the day, it is scale and size that the major players are betting as we move towards an age where over-the-top delivery will be the number one distribution medium for reaching mass audiences.
Disney, which is in the process of acquiring most of 21st Century Fox’s TV and film assets in a US$66 billion deal that was agreed in December, is primed to launch its OTT entertainment offering next summer, after going live with its US direct-to-consumer sports service EPN+ earlier this year. Disney Play will feature Pixar, Marvel, Disney and National Geographic content as well as the Star Wars franchise – including Disney’s forthcoming live action Star Wars series.
Speaking on Disney’s third quarter earnings call in August, Disney CEO Bob Iger said that Disney aims to be in the “quality game” rather than the “volume game” with the service, but that it will also include a “significant amount” of library content. He added that Disney was “obviously very excited” about bringing 21st Century Fox content to the new service once the acquisition of Fox’s entertainment assets closes.
In this climate, Netflix’s original content strategy has never looked so essential. With a US$7.5-US$8 billion content budget for this year it is betting on series, films, unscripted, docs, comedy specials and non-English language content. Just this week it also confirmed it is in final negotiations to buy a US production studio in New Mexico, Albuquerque’s ABQ Studios, to help its content efforts. The plan will see Netflix invest US$1bn into production in the state over the next 10 years.
At the same time another giant, Apple, is busily preparing to make its push into the content space. The company hired Sony Pictures Television’s co-presidents Jamie Erlicht and Zack Van Amburg last year to lead original programming and since then has appointed former Channel 4 content chief Jay Hunt as European creative director of worldwide video, hired BBC Films veteran Joe Oppenheimer as a creative executive for its international team, and signed multiyear deal with Oprah Winfrey.
Apple is also making a more concerted effort to get its Apple TV hardware into people’s homes, signing deals with operators like Charter Communications in the US, Canal+ in France and Salt in Switzerland. Just this week, a report emerged claiming that BT is also now in talks about making its mobile network, EE, a distributor of Apple TV set-top boxes.
FAANG group digital leaders and old media giants alike are all vying for as much of the OTT market as they can get, and with good reason. According to Digital TV Research, in stats released this week, over-the-top-delivered content will account for 46% of all Western European TV revenues by 2023, up from 26% in 2017, after more doubling from US$10 billion to US$23 billion over the forecast period.
On a global basis the same research outfit expects OTT TV and movie revenues to increase from US$53 billion in 2017 to US$129 billion in 2023, with the US will remain “the dominant territory by some distance.” The revolution will be televised and delivered via the internet.
Pluto TV to launch pop-up channels and Action Sports. digitaltveurope.com/2018/12/12/plu…
12th December 2018