Jun 8, 2015

OTT Is All About Live and Other Takeaways From the Q1 Freewheel Report

Originally published at TV[R]EV on May 26, 2015

Live sports, or more precisely it’s role in the nascent OTT ecosystem was the main story from the latest Freewheel Video Monetization Report, which measures ad viewership on digital video. The amount of live content overall is growing tremendously, up 140% year-over-year (YOY) with most of that coming from live sports (82%). That’s good news for programmers and operators as much of that viewing comes from behind the Authentication Wall: 57% of long-form and live views are from behind the Wall. Live SPorts.pdf (page 10 of 32) That number pales in comparison to the astounding YOY growth of authenticated viewing overall: a whopping 328% increase which is matched and bested by the 499% growth rate in authenticated views for sports. And while much of that growth can be attributed to availability—many more sporting events are now shown live via OTT—the numbers still represent an eye-popping growth rate in the number of people watching live sports online. Where they’re watching it is of interest as well. While many in the tech world assume everyone has an iPad, a Roku and an Apple TV, the fact is that even with authenticated programming, most OTT views still come from laptops and desktops: 65%. (SEE CHART). Authenticatd Device Chart Streaming devices (Roku, Chromecast, Apple TV et al.) are rapidly catching up though, with 19% of authenticated views and a whopping 380% YOY growth rate. Streaming devices are especially popular with viewers of live content: Live represents 73% of all ad views on streaming devices but only 7% of all ad views on smartphones.

So what’s the takeaway?

  • Live Viewing Is Growing: As programmers perfect the infrastructure that allows them to broadcast live events (live sporting events in particular) via OTT, the number of viewers is growing too, at an astonishingly rapid clip. This indicates a real demand for access to live sports across all screens, particularly by those who are currently pay-TV subscribers. 
  • Don’t Write Off The Laptop/Desktop Crowd. When 65% of your audience is watching on a laptop or desktop (versus 19% on a streaming device) it’s foolish to dismiss that as the behavior of a few holdout fuddy-duddies who haven’t gotten with the streaming device or iPad program yet. Smart programmers will plan for laptop/desktop viewing, particularly on live sports where it’s easy to add in additional content, content that can be further monetized. 
  • Pay Attention To Roku. While all streaming devices are experiencing a growth spurt, Roku is starting to dominate the market. As I pointed out last week in Apple Is Flunking TV 101, Roku now has a whopping 43% of all OTT ad views (up 37% year to year) while Apple TV has just 20% (down 36% year-to-year.) That’s a huge gap and unless Apple makes some bold choices on the next release of it’s Apple TV device, Roku appears poised to walk away with the streaming device market. Put them on the top of your “companies to talk to” list. 
  • Discount The MVPDs At Your Own Risk. All the noise about cord cutting and cord nevering aside, the number of pay-TV subscribers who are watching OTT TV is skyrocketing: authenticated views are up 328% YOY and that number is particularly significant around live events, most of which require MVPD log-in. Viewers are quickly understanding the value of their pay-TV providers TV Everywhere apps and they’re using them to watch live sports on a range of devices. Even when they’re watching via a network’s own OTT app, the necessary authentication (and the data that goes with it) is supplied by the MVPDs. 

So that’s where we stand after just one quarter of 2015. If we look at the year like a football game, no one’s pulled away with the lead yet and there’s plenty of time to catch up. That said, clear trends are emerging and if you’re a smart players you’ll be paying attention to them

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