For LatAm operators, OTT is an opportunity… and a threat

November 3, 2014 7:52 pm Tags: , , , , , No Comments 0

Latin American pay-TV operators have a window of opportunity to offer video-on-demand or subscription video-on-demand services to compete with – or be complementary to – Netflix in their local markets.

“It’s ours to lose,” said Mauricio Ramos, president of Liberty Global Latin America, during the panel discussion. “It’s completely ours to lose.”

While Netflix remains a threat to operators, there’s an increasing opportunity for operators willing to go over-the-top with content and take advantage of the ability to go out of their current footprint.

“Cable operators no longer have walls around their technology,” said Tom Wirth, SVP Americas for Nagra. “Now, operators can go out of market… there are no longer boundaries.”

Ramos pointed to new-generation technologies like real-time video, search and aggregation of video and video on demand iterations as examples of where operators could expand services.

Approximately 20 million viewers in Latin America will take some sort of subscription video-on-demand service by 2020, according to research from Dataxis, with the bulk of the market continuing to belong to Netflix.

Nearly three-quarters (72%) of SVOD subscribers currently use the U.S.-based video aggregator, with about 16% of the market using Claro and 12% using other SVOD services.

Netflix has said that while it expects its business to eventually be 85% international, it also anticipates 85% of the content to be from Hollywood, with just 15% being locally developed.

That, said panelists at the conference, gives local operators an opportunity to take a bigger share of the market, either by offering a complementary service with locally generated content, including sports, or to offer a competing service with international content as well.

The advantage that local pay-TV operators have is an established network and customer base that can support a rapid deployment of either an SVOD or VOD service.

Some of those services may be a la carte services, similar to those being rolled out in the United States by CBS and HBO, giving operators additional opportunities to act as aggregators with more specialized “skinny bundles” that would appeal specifically to local markets and subscribers, as well as outside traditional service footprints.

Source: For LatAm operators, OTT is an opportunity… and a threat