Monday 27 February 2017

The State of Live Video 2017

StreamingMedia

Sport leads the way as live video continues to grow. Will this be the year it overcomes problems delivering quality results at scale, conquering latency, and securing monetization?
http://www.streamingmediaglobal.com/Articles/ReadArticle.aspx?ArticleID=116581&PageNum=2

Over-the-top (OTT) video was an unstoppable force in 2016, and it’s on par to continue a strong growth trajectory. Juniper Research projects a fourfold market increase to $32 billion by 2019, highlighting how improvements in user interface and bandwidth infrastructure flexibility have encouraged consumers to steer away from traditional digital television content delivery.
The demand for live video content over multiple devices has grown as well, and the social media giants have been swift to feed this hunger. With Facebook, Twitter, and Instagram growing in popularity as live streaming end points, it is important for content players to syndicate to them in order to extend their consumer reach. This will be particularly applicable for sports content in the next few years, as 63 percent of sports fans have expressed their willingness to pay for an OTT subscription to watch their favorite teams and players, according to Statistica.
“Live continues to provide the ‘power of now,’ that sense of immediacy that engages your audience and that can create a sense of pressure to participate,” says Chris Knowlton, VP and streaming industry evangelist at Wowza Media Systems. “On the business side, such an opt-in audience is more likely to be engaged, especially when live viewing is merged with shared social experiences.” The result is that viewers are paying attention to the live stream, and they will watch it up to 10 times longer than on-demand content, according to a report from Ooyala.
In 2016, nonbroadcast companies such as Facebook, Google, and Twitter truly entered the live OTT scene, with Twitter combining social and live NFL games.
“Live will continue to grow faster than VOD in OTT,” says Per Lindgren, SVP of live OTT for Net Insight Net. “We will start seeing more 360° and some initial VR initiatives. Players like Facebook and Google will continue to drive innovation, but larger content owners will also bring innovative solutions and viewing experiences to the market.”
Key trends include the growth in audience size for live online events and sports, as well as increases in video resolution and length of view time.

Is OTT Now Simply the Best?

While the TV remains the preferred viewing screen, the content is increasingly being delivered OTT, causing some to question the longevity of the prevailing playout and distribution model.

“In Europe, we’re at a point with video quality that it’s better than what’s on cable and on satellite,” says NeuLion EVP and co-founder Chris Wagner. “Video quality on the old distribution platforms is falling behind. IP-based delivered-video quality is just stunning now, plus you have the move to 4K.”
Rory McVicar, project manager of CDN EMEA for Level 3 Communications, points to advancements in multiroom streaming set-top boxes (STBs) that have reinforced the belief that audiences want content on their owns terms.
“The idea of sitting down with your family in front of the television to watch a major sporting event is by no means dead, but already feels like a nostalgic representation of old viewing habits,” he says.
While live OTT offers advantages—such as an interactivity and portability that TV can’t match—the broader consensus is that for the time being, online delivery will work alongside other technologies as a key part of the technology mix.
“New technologies available for OTT distributors, such as accelerated delivery and prepositioning, address buffering and startup challenges, but they do require a more strategic integration with CDN providers,” says Ian Munford, EMEA director of product enablement and marketing, media services for Akamai.
“In many cases, satellite and broadband complement each other,” says Jonathan Berman, CBO, Video Solutions, MX1 (which is the media services company created in September by satellite provider SES from its acquisition of fiber and internet services company RR Sat). “Satellite is still the dominant way to serve quality content. As infrastructure improves we will see more and more OTT, with flavors of linear components.”
Knowlton’s view is nuanced. Many people have live viewing experiences that are nearly as good and predictable via OTT as from traditional television service providers, he says. “Yet there’s still a very large population of people for whom network bandwidth and quality are insufficient to support streaming services reliably. For most of those, standard TV offerings may provide a better experience—for now. As more content providers go direct to viewers, the lines between OTT and pay TV services will continue to blur, and we’ll need new ways to differentiate them.”
Lindgren highlights the need to overcome scalability issues and to solve the delay and sync problems in OTT which he says is hindering the monetization of new live content.
“Virtualized cloud adoption, business models to leverage personalized TV models, and the potential to add data and statistics for an enhanced live OTT viewing experience are all converging,” he says.
Consumption of live content is evolving due to the very nature of the OTT market, which, compared with linear content delivery, has a low cost-of-entry and offers a rapid time to market. As a result, more niche content providers and broadcasters can enter the market using the cloud without the large-scale, high-cost overheads and infrastructure typically incurred with traditional linear content delivery.
“The relationship between viewer and broadcaster will also become more intimate,” says Dan Finch, commercial director at Simplestream and TVPlayer. “As the financial cost and turnaround time in delivering content reduces, more specialized and niche broadcasters can harness the means to effectively engage with their audiences.”
Monetization, however, remains a crucial piece of the puzzle. “With platforms like Facebook Live generating and delivering live content to a plethora of socially syndicated devices, the need to ensure effective delivery to drive monetization efforts is important—especially to mobile,” stresses Finch. A recent report from Ooyala found that 51 percent of video is now viewed over mobile devices, illustrating a clear need for effective multiplatform content delivery.
“After all the hubbub about OTT live latency (e.g., Twitter streaming of NFL games), expect to see a strong focus on scalable low-latency streaming in 2017,” says Knowlton. “Look for the overlap of AR [augmented reality] and low-latency live streaming to create interactive and highly engaging experiences that could capture strong consumer interest through innovative applications.”

Rio Breaks OTT Records

The Rio 2016 Olympics in August was predictable in terms of setting new streaming records around the globe. Host broadcaster Olympic Broadcasting Services (OBS) churned out more than 7,100 hours of coverage from Rio to reach an estimated all-time high television audience of 5 billion.
However, the volume of coverage available online nearly doubled that of traditional TV, with live streams available from every session of the 28 sports comprising 218,000 hours versus the 81,500 hours attained in London 2012, “marking a milestone in Olympic broadcasting history” according to OBS.
What was less anticipated was the large dip in broadcast television viewing, at least in the U.S. “Were fewer people watching in 2016, or was it that many younger watchers were engaging this year via streaming and social media clips?” asks Knowlton.
Overall, more than 9 million hours of content were streamed globally through Olympic Video Player platforms powered at their core by Wowza Streaming Engine software. NBCUniversal alone streamed 2.71 billion minutes of live coverage—more than a billion more minutes than the live totals of all the previous Olympics combined.
This may have saved NBCU’s bacon, since views to its linear coverage were 10 percent to 15 percent down on its expectations (it was forced to open up more online ad inventory as a result). Viewing for the Opening Ceremony, for example, showed a 28 percent decline from London 2012. Viewing to its digital service was also down around 9 percent, yet 10 percent of the network’s entire ad revenue for Rio came from digital. Variety, which sourced these figures, suggests that the Peacock needs to get smarter at marketing the games across all its platforms for more than just 2 weeks every 4 years.
Microsoft Azure provided the cloud platform for NBCUniversal’s Rio service, Akamai provided its content delivery network (CDN) and quality of experience (QoE) monitoring, and Adobe Primetime was deployed for playback, ad insertion, and authentication services to NBC’s Olympics app.
The games were nonetheless a record breaker for Akamai and the BBC. The CDN drove 100 times more live streaming than 2012 at twice the speed and three times the traffic peaks. Traffic peaked at 4.53Tbps, with audience sizes of 1.54 million at an average bitrate of 2.75Mbps.
BBC Sport's online coverage reached 68.3 million devices in the U.K. and 102.3 million globally, both records for the broadcaster. In addition, 30.2 million U.K. browsers streamed the action on BBC iPlayer and BBC Sport.
“Unique browsers” is calculated by the number of devices being used to view online coverage, which is why it was possible for the U.K. digital audience to total 68.3 million, even though that is greater than the country’s population.
The year’s other major sports event in Europe was the UEFA European Championship, which also saw record views over OTT platforms. England’s 2–1 win over Wales attracted 2.3 million viewers to the BBC Sport website, more than doubling the broadcaster’s previous highest live OTT viewing figure.
“This change in the way people watch their favorite sports will ultimately help open up the market to increased diversification, allowing more niche markets to develop more readily—think skateboarding, surfing, and darts as promising examples,” observes Finch.

Facebook Live Offers Global Reach

Arguably the biggest streaming technology news in 2016 was Facebook Live’s April arrival for the masses. While many people tried live streaming apps (e.g., Periscope, Meerkat, and Wowza GoCoder) in 2015, Facebook Live was the first one that almost everybody with a smartphone already had in their pockets.
“Having a subscriber base of 1.8 billion active monthly users gives Facebook a unique platform to socialize and promote new technology concepts at a scale of which most content companies could only dream,” says McVicar. “Products like Periscope have generated a lot of interest but have not managed to achieve true mass adoption. Facebook Live has the potential to build live streaming experiences into the daily web interaction habits of large swathes of society, spanning age groups and cultural backgrounds.”
Wowza’s Knowlton describes Facebook Live as “arguably the most disruptive product in streaming media today” by making possible one-to-many live stream creation and consumption to almost anyone. “Consumers have become accustomed to using the closest device to them to watch almost any content on demand,” he says.
Viewer hunger for live streaming content is abundant beyond sports. GlobalWebIndex found that live funny/entertaining videos rank the highest in viewer popularity (53 percent), followed by breaking news stories (41 percent), music/concerts (38 percent), educational talks (29 percent), brands/commercial videos (26 percent), celebrity videos (22 percent), and vlogging (19 percent).
“As live OTT video continues to expand into more of these areas, the need for these content players to optimize with a unified workflow that reduces costs and increases the quality of live content delivery is more crucial than ever,” stresses Finch.
Perhaps most dramatically, the expectation for live is feeding user-generated content via social media platforms. Social networking is forecast by Ericsson to be the second biggest data traffic type on mobile after video, growing by 39 percent annually. For Wowza, the evidence lies in the number of sites from which users can watch such live streams, and the number of Wowza customers using its software and services as part of their workflows to deliver those experiences.
“Consumers want a live option for anything that falls into that category of ‘appointment to view,’” says Berman. “People are viewing live streaming as an opportunity to promote their brand and make money through their personality and interests,” observes McVicar. “As part of this, vloggers have increasingly become part of the cultural mainstream due to the relative ease with which they can use simple technology to reach mass audiences.”
Facebook Live’s launch prompted rivals to up their game. “YouTube has invested more into the live environment and made discovery very much easier (though not as good as Facebook),” says Gareth Capon, chief executive at Grabyo. “With Periscope Producer, Twitter offers content owners the ability to stream higher quality content to audiences, while Twitter Live is focused on the top tier of the market acting more like a traditional broadcaster by paying for rights to distribute across the platform.”
When Facebook unveiled its live streaming API in April, one of the first media partner solutions to board was Grabyo’s online video production and distribution software.
Soccer club Real Madrid immediately used Grabyo to push content from its club TV channel to Facebook Live, subsequently generating more than 110 million views. The success not only highlights the way in which social offers greater reach than traditional channels but also the threat that OTT is set to pose to those same channels.

Social Drives Live Sport

As sports rights holders (like the NBA and NHL) begin to take live games to social media, the monolithic TV model looks to be in the first stages of fragmentation.
Those with a deep fan base realize they can directly monetize consumers with subscriptions and bypass the middle man. Meanwhile, many traditional broadcasters cannot afford not to be on every platform. This is not just about bringing live streaming to other devices that have not been part of the normal distribution; it is fundamental to TV Everywhere.
Even rights holders of niche sports, like World Surf League, are able to do this increasingly as the cost of production and distribution continues to reduce while video quality continues to rise.
“The major change has been around live with regards to social distribution,” says Capon. “Three years ago, I don’t think we’d find a major sports property streamed live to Facebook without a direct commercial model being associated with it. Fundamentally, streaming live on social platforms delivers reach and engagement for sports.”
Other examples include the French Football Federation broadcast of 400 third division and grassroots matches on Dailymotion, along with the Women’s Tennis Association (WTA) October launch of digital and social content division WTA Networks and the November launch of Dugout, a social media network backed by Europe’s top-tier soccer clubs including Real Madrid, Chelsea, and Bayern Munich (though live video is not part of Dugout’s initial plans).
“The driver has been enormous growth of video consumption through social platforms like Instagram, Twitter, Facebook, and Snapchat, all happening primarily on mobile,” Capon suggests.
It’s telling that one of the biggest rights deals of the last few months was struck by Chinese video streaming service PPTV, which spent £560 million (about $706 million) on English Premier League rights over 3 years.
“You are seeing rights owners like Formula E make distribution deals with Facebook in every market where they don’t have TV deals, using social platforms systematically to reach a new audience,” says Capon. “The NFL’s deal to distribute live games on Twitter is a chance for it to play around with social and start to understand consumption patterns and the market for streaming to mobile devices.”
Proving return on investment is an obstacle because of inconsistent cross-platform measurement. “While sports generates a lot of consumption on social platforms, the challenge is to merge the ratings around traditional TV with a complete multiplatform framework,” adds Capon.

OTT and TV in Sync

The inherent problems with respect to delays and sync with today’s live OTT solutions became evident to the public, boosted by several articles in both trade and daily press.
Time lag can be up to a minute over OTT, which matters when sports like Formula One or athletics count victories by 1/100th of a second. One of the breakthrough technologies in 2016, set to make a big impact in 2017 and the winner of Streaming Media Europe’s Readers’ Choice Award in the multiscreen solution category, is Net Insight's Sye.
“With VoD and recorded content becoming a commodity, live content constitutes an increasingly important part for both content owners and broadcasters,” says Net Insight’s Lindgren. “Around live, it is possible to create an increasing amount of extra content, but the actual live moment is what engages viewers and fans globally and locally. There will also be an increased focus on low delay and sync to enable such new viewing experiences, and this will in turn open up new business models where OTT will not just be a cheaper or more agile way of broadcasting live content, but will change the way people experience and interact with live content.”
Sye claims it can frame-accurately marry the OTT stream to the TV network-delivered broadcast, making it ideal for second-screen viewing. It has been in commercial tests with Tata Communications, the firm that provides connectivity solutions to Formula One. The software runs over Tata’s network, effectively converting it into a virtual CDN to deliver synchronized broadcast and streamed content to all end points.
“We’re not trying to be real time, but to harmonize with existing satellite distribution,” Lindgren explains. “The aim with satellite is to deliver within 8 to 12 seconds and with the delay resulting from video contribution and other upstream processes being typically around 5 seconds, we still have 3 to 7 seconds to play with for synchronization.”
Another Scandinavian company also claims to have cracked mobile/broadcast sync. Oslo-based The Future Group is developing the game show Lost in Time with X Factor producer Fremantle, which transmits a live studio production created in Unreal Engine synchronous with a game also created in Unreal to a mobile app.

Discovery and Disney Play for “Sports Netflix”

Perhaps the most significant mergers of traditional with what used to be called “new media” were the deals struck in July by Walt Disney Co. and in August by Discovery Communications with BAMTech, a spinoff from Major League Baseball Advanced Media (MLBAM).
Discovery and Disney are using BAMTech’s backend streaming optimization services to power multisport direct to consumer products. In Discovery’s case, this is the Eurosport Player, which the operator’s CEO David Zaslav has dubbed the “sports Netflix.”
Discovery owns pan-European sports channel Eurosport and used it as a vehicle to acquire, for $1.2 billion, the pan-European TV rights to the Olympics from 2018 to 2024.
The goal is to help Discovery amass 1 million subscription video on demand (SVOD) subscribers globally this year, a figure forecast by the operator to rake in $100 million in extra revenue.
Discovery will do this by curating services around the sports properties it holds, including the Olympics, the Tour de France, and Wimbledon. That task falls to Ralph Rivera, formerly the BBC’s digital director, who has led Eurosport’s digital operation since September.
BAMTech, meanwhile, gets its first major foothold in Europe and strikes at the heart of the live and on-demand streaming business that Italian-based specialist Deltatre has built up with clients like UEFA, ATP Tennis, and HBS, the host broadcaster for FIFA.
Meanwhile, Disney is launching an ESPN-branded online proposition. “It will not, however, include any current ESPN channels or its content,” says Daniel Gadher, analyst at Ampere Analysis. “This cautious approach is perhaps due to a fear of cannibalizing its audience. ESPN’s new service will exploit rights held by BAMTech, MLB, and NHL.”
The runaway success of MLB.tv and its mobile app At Bat—which helped propel the MLB to $10 billion in revenue in 2016—attracted Disney’s investment in BAMTech, which valued the firm at $3 billion. The deal gives Disney an option to buy BAMTech outright, potentially extending the organization's reach into Europe via Eurosport.
A smaller but equally smart sports rights aggregator may beat them to the punch. The Perform Group launched DAZN in August, which according to CEO Simon Denyer is “the first time anyone has launched a pure multisport OTT platform.”
“By going direct to individual consumers, we will build a record of viewing history, and we will be able to automatically recommend and serve content relevant to each viewer,” he says.
Perform paid $2 billion for rights to Japanese soccer’s J-League starting in 2017—the largest commercial deal in the history of Japanese sports. Other rights in select territories include the German soccer league Bundesliga.
Using cloud-based production and facilities located in every continent, Perform aims to take DAZN global. It takes the international host-produced signal of live events and customizes it for audiences with commentary and stats compiled from the data specialists Opta and Goal.com it owns.
“We have researched 30 territories and prioritized those we think have good fan bases for sport, a good broadband infrastructure and 4G network,” Denyer says.
One thing is clear: the consumer appetite for live content shows no signs of lessening, nor does publishers’ and technology vendors’ desire to deliver that content in new and innovative ways.
This article was published in the Spring 2017 European edition of Streaming Media magazine.

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