Netflix and Amazon dominate, but on the OTT market are developing a variety of niche platforms that have great success with a relatively small audience.
The largest streaming platforms such as Netflix, Amazon Prime Video, and YouTube has fundamentally changed the way video content consumption and audience habits. At the moment in the US, the average subscriber is subscribed to one or two SVOD service in the UK, every second subscriber is subscribed to at least one streaming service — and usually it’s Netflix or Amazon Prime.
It would seem that the dominance of global giants leaves no chances to competitors, but in fact, Netflix and Amazon have served as a sort of battering RAM, wide entrance to the market of many new VOD services, and accustomed the audience to consume the content in a new format. Valid competitors Netflix and Amazon are the same giants platform from Apple, Warner Bros. and Disney preparing for the invasion on the world market streaming. But this market is much more diverse than it may seem at first glance.
One of the first on the market VOD began to make progress, the state broadcaster, launching a platform for access of spectators to the directories shown movies, TV series and programs — the format is known as BVOD (Broadcaster Video On Demand). BVOD services are widely spread and popular in Europe. According to Ampere Analysis, each of the three largest UK BVOD services visited monthly by more than a quarter of the population of the country: every month the BBC iPlayer is used by 60% of the British, ITV Hub — 40% and All4 — 25%. Germany’s most visited BVOD platform is ARD (23.6 per cent) and ZDF (28.3 per cent); in France — TF1 (25.3%) and M6 (18.8 per cent).
Pay-TV channels, the famous first-class original content, such as Sky, Discovery, HBO, Showtime and Starz also launched a successful premium VOD services. In Scandinavia intensively developed owned by Nordic Entertainment Group Viaplay streaming platform, which has 1.4 million subscribers. Viaplay investing heavily in producing its own content — the premiere of five new series this summer, another six in the process.
The OTT market is well developed not only in the US and Europe. For example, in China since 2012 actively compete and grow three of the largest local video service iQIYI (Baidu from the company), Youku-Tudou (Alibaba) and Tencent Video, and in South-East Asia is highly popular regional platforms, such as iFlix
The business model of streaming services vary widely, principal — paid subscription like Netflix (SVOD) and free subscription with ads like YouTube, Pluto and All4 (AVOD).
Finally, streaming services vary in specialization — and the OTT market successfully developing a variety of niche platforms, which meet the interests and tastes of their target audiences.
In the UK, these services work a great many, however, according to Ampere, each of them has an audience of less than 1% of the total number of British subscribers. It specializes in movies and TV series of the BFI Player, Curzon Home Cinema, Mubi and Starz Play, and sports services NBA League Pass, NFL League Pass, Eurosport Player.
Gaining popularity in UK, USA, Australia, Italy and Belgium Walter Presents a video service specializing in high-quality action-non-English serials, which personally selects the catalog of Italian producer Walter Iuzzolino. Uzzolino, who is also a co-founder Walter Presents, believes that Netflix and Amazon successfully to “reformat” the consumption of video content worldwide, and thereby paved the way for more specialised platforms.
Place in the market as the main product — content — missing all: catalogue of the Walter Presents is growing and is very popular with the audience, despite the fact that Netflix and Amazon are all actively removed non-English-language series and content designed for a regional audience. Uzzolino confident that the ensuing competition between the major streaming services and the national TV stations has a positive effect on the quality of content and quantity.
Local partners Walter Presents major broadcasters who know the local market and have a huge audience such as Channel 4 in Britain and PBS in the United States.
The main success factor of the service, according to Iuzzolino — right format selected AVOD. Free access attracts a wide audience and big advertising budgets, and that commercial success is calculated in Walter Presents. According to Azzolino, the service has gained quite popularity Masterkovoy due to the fact that he took a course for a wide audience, not snobs film critics and the intellectual elite.
“In this market, winning the players clearly following its mission,” said Nick Walters, the head and co-founder of SVOD service Hopster, specializing in educational videos and other content for preschoolers. Hopster distributive content through its streaming app is a Scottish broadcaster STV also videos Hopster placed in the children’s sections of American media players Xfinity X1 and Sling TV.
“We help children to acquire new knowledge in an exciting format, and focused primarily on creating and posting such content. We do things with their hands, often find stunning and undeservedly little-known content abroad — we don’t need to compete with Netflix and other major companies, we are happy to realize its mission and be able to successfully do their job”.
In the niche of documentaries, too, have a place to turn around and find its niche. For example, the SVOD service Stream specializiruetsya Curiosity on scientific and historical topics, and Docsville (previously the service was called Yaddo) on biographical documentaries. The first service launched by the founder of Discovery Channel John Hendricks, the second — the former head of BBC Storyville Nick Fraser. And, for example, LoveNature platform is entirely dedicated to documentary films and series about nature.
“Even within the same niche can successfully run several services each on its audience” — says the founder of the Agency on content strategy and licensing Rights Stuff Wendy Bernfeld. Bernfeld will speak at the upcoming conference IBC Show report “Competition in the OTT market is not only big brands”. Other participants of the conference are representatives of such niche platforms like the above mentioned Hopster and Trace Play (service for fans of the Afro-American music) and the independent television Orange Content and All3Media.
While the largest OTT platform positioned as competitors to the traditional TV broadcast, niche streaming services rely on their subjects and the loyalty of a relatively narrow range of audience. According to Bernfeld, for niche players to compete with the major players is detrimental, as the latter have incomparably larger production budgets. Instead, it would be harder to develop in their area and to offer content that viewers won’t find in mainstream catalogs.
“I think the surest strategy for niche SVoD service is gradual development: you can start with small thematic catalogues and a low monthly fee, and then add new options (for example, start formats or AVOD TVOD) or to start producing their own content, as far as possible,” says Bernfeld.
Also, in her opinion, it is important not to repeat the mistakes of some failed SVOD services — not to chase popularity at the expense of quality content and try not to copy competitors. Qualities necessary for a successful niche player — perseverance, hard work and continuous development in their specialization.
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