The Key to Reducing Churn? Flexibility
By Konstantin Wilms, SVP Cloud, Deluxe Entertainment Services Group
People want to watch your content. They just want to watch it on their own terms, anywhere, at any time.
The OTT space is rapidly growing. By 2020, there will be 455,700,000 subscribers of SVOD services. But it’s not just going to be the biggest players taking over the space. Market analyst Ovum predicts that Amazon and Netflix will make up only 15% of the SVOD market by 2022.
With so little of a growing market dedicated to major players, many customers will be queuing up SVOD content from smaller providers. Which means that, when building their OTT products, smaller providers will need to contend with a bevy of challenges that range from third-party integrations to managing new technologies and standards, while simultaneously making an effort to differentiate their offerings from a user interface and interaction perspective.
Customers are asking for significantly more flexibility in their OTT services, and the platform a service provider runs on and product offerings they create must be flexible enough to accommodate them for both the underlying content workflows as well as the presentation of the content. i.e. the entire system from top down needs to be both modular as well as flexible enough to accommodate a multitude of user interface, presentation, and interaction configurations.
Modularity Makes Things Easier
For OTT providers, modularity is a major product differentiator. A modular UI can be rapidly enhanced and extended without having to sacrifice on or reinvent core user-facing features such as quality of experience, navigation efficiency, search immediacy, analytics, or customer&API-facing features. Flexibility in presentation also allows for uniquely branded interfaces to be quickly built without having to rely on inflexible template-based approaches.
The challenge, however, is to ensure that a modular approach to design on the application-side experience is extended into the full application stack. Without alignment, tech debt is a natural byproduct, and this often takes the form of development teams moving business logic from the services side into the application’s user interface.
And when it comes down to how your teams operate, this approach allows for clear separation between the services side of the platform, the applications side and the user interface integration teams, ultimately allowing application user interface design & customization to be decoupled from the rest of the stack.
Paying it Forward to Your Customers
A modular UI does more than save your team from headaches — consumers also experience the difference. With the ability to move quickly enough to fit customer demand, you can build the best experience for audiences based on how they are actually using your service.
But what about the underlying infrastructure, storage and compute platform that powers an OTT product offering? Can the formula of modularity across the entire stack be applied here as well?
When we were developing the OTT product for Deluxe One, which provides content owners of all sizes with an easy and flexible way to enter the OTT arena, including content management, delivery, and monetization services, we focused on not only creating modular service and application tiers, but also on utilizing cloud provider managed services wherever possible. This allowed us to focus our efforts solely on our product offerings, and eliminated time spent managing and building infrastructure and services that would provide us with zero market differentiation. This approach also allowed us to focus our development team efforts and allowed us to reduce the size of our DevOps and automation teams.
Content owners focus on making great content, but when it comes to building platforms, smaller content owners are challenged to shore up the resources and time-to-launch quickly, especially given the threat of churn based on UI/UX functionality that can have a ripple effect across an entire platform stack. Working with managed services in the cloud helps them punch above their weight class.
By housing everything in the cloud under a single pane of glass, an OTT service provider can not only get to market faster, but also turn platform metrics around infrastructure, spend, performance and capacity into actionable data to reduce churn, optimize performance, and provide a more performant service offering from a single access point. In an industry where reliability issues could potentially eat away at 76% of your customer base, this level of access is critical to success.
Moving to a cloud-based, managed services infrastructure is a natural evolution in the way platform builders need to do business, much in the same way we saw a shift from monolithic infrastructure to microservices, function-based services, and cloud-based managed services.
With the decline of the U.S. pay TV ecosystem at its “worst rate ever,” and multiple major streaming launches coming in the next six months, there’s never been a more pressing time for content owners of all sizes to embrace streaming. Audiences are flocking to OTT services and the market is there, but OTT services also come with a risk of severe churn depending on customer experience.
With a cloud-based modular architecture, predictable infrastructure challenges become a non-issue. The decentralized nature of the platform and elastic scale are designed to allow providers to be nimbler, to be more productive with a smaller team, and to be more agile in launching features that matter for the end customer.