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Connected device apps driving revenue generation

September 1, 2016

Connected device apps for the monetisation of video services are now the second most used method for consumers subscribing to OTT services, according to a new Parks Associates whitepaper, sponsored by Ooyala. The whitepaper, Connected Apps: The New Battleground for Video Services, shows more than 25 per cent of OTT video service subscriptions were purchased through a connected device app, including apps on streaming media players, game consoles, and connected TVs. Apps on connected devices trail only service provider websites in securing OTT subscribers.

“This finding reveals the increasing importance of connected devices as a channel for revenue generation. OTT video services continue to lead pay-TV providers, broadcasters, and cable networks in use of connected apps to deliver content to the television,” said Brett Sappington, Senior Director of Research, Parks Associates. “Lacking a presence on a connected device is essentially ceding the market to others. As competition for video services becomes more intense, companies are adding support and enhancing their apps for connected devices.”

The biggest beneficiary of connected app usage among OTT providers has been Hulu, with 37 per cent of its subscribers signing up for their subscription through a connected device. OTT leader Netflix has seen 28 per cent of its subscribers come on board using this method.

“Parks Associates forecasts that OTT subscription service revenues will double from $15 billion worldwide in 2015 to $30 billion by the end of 2020; however, entering the OTT market has historically been extremely costly and time intensive, holding back many companies from capturing their share of the market,” said Belsasar Lepe, Co-founder of Ooyala. “Ooyala now offers a turnkey solution for building and deploying rich OTT experiences, reaching web, mobile, and connected devices quickly, cost-effectively, and without requiring highly technical staff.”

Connected Apps: The New Battleground for Video Services examines how video apps on connected devices are playing a key role in the competitive landscape of digital video entertainment. The whitepaper notes increased attention on apps is not unique to just OTT providers but rather a variety of industries viewing apps as a way to improve their business and interaction with consumers, including:

  • Pay-TV Providers
  • Broadcasters
  • Cable Networks
  • Media/Publishers

“Connected apps are no longer a way to stand out from the crowd – they are essential for survival,” Sappington said. “In an increasingly competitive environment, greater reach and exposure give companies the chance to capture attention and revenues.”

Categories: App, Articles, Broadcast, Connected TV, Content, Markets, OTT, Pay TV, Research