NEW YORK--Netflix (NASDAQ: NFLX) has proven that content can be a revenue driver and has driven multichannel video programming distributors (MVPDs) and content providers alike to improve their online offerings. But the myriad technologies available and ever-changing content rights issues are slowing deployment of multiscreen services.
Panelists at a Streaming Media East session on multiscreen video agreed that the segment is a "very fragmented, very busy market for consumers," as Discovery Communications' Gabe Sauerhoff, VP of digital media distribution, put it. With online video providers adding original content to their offerings in a bid to further differentiate themselves, consumers face even more choices.
At the same time, cable, IPTV and satellite operators are struggling to meet consumer demand for content that conflicts with their traditionally longer development cycles.
"Video on demand has been around many years at this point, and we're just getting to where there's a scalable way to monetize that platform," Sauerhoff said.
David Ludder, VP of technology for iN DEMAND, agreed, noting that "dynamic ad insertion has been really tough to get going."
Comcast only just announced a deal with Turner that would see dynamic ads inserted into the VOD content it has licensed to Comcast, and the cable operator started exploring ways to accomplish this feat several months ago.
Inserting dynamic ads into streaming video is less of a challenge than it is for set-top-based VOD delivery.
"On devices that hurdle is a lot lower," Ludder said. "For the Web we can get that done quicker than for on demand. Plus product tie-ins, shopping, things you wouldn't have thought about doing on set-top boxes or on demand."
But making sure that Web-based multiscreen experience fits within a provider's existing video service, marketing and branding structure can be a challenge.
Tricia Lynch, Verizon (NYSE: VZ) director of content strategy and acquisition, said that FiOS' move to second screen could have gone more smoothly. "We've taken several overlapping approaches to multiscreen," she told the audience, citing its growth from Flex View, to its transactional sale and rental service, to Verizon TV Everywhere, to last year's release of the FiOS Mobile app.
"The difference is we focus on live or on demand stuff on different platforms. From a consumer standpoint, we should not have pointed out all these differences. We should have just said we're bringing you … (something like) 'FiOS Everywhere,'" she said, adding that Verizon should have dealt with many of the rights issues plaguing the multiscreen segment and firmed up its technology.
Lynch has worked at Verizon for a decade and said she was stunned at how long it has taken for a more unified on-demand experience, both linear and digital, to be made available.
"We're in year three or four of a 10-year plan. My goal is everything everywhere, but I've got to convince all these guys at the same time. And they're (trying) to make sure they don't do anything that damages the business," she said.
Meantime, online video technology is marching forward, creating pressure on legacy providers. "My concern is whether the appetite in the market will keep up with the technology of set-top box-based video on demand," said A&E Networks' Richard Shirley, VP of distribution business development and product operations. "…I can spend a lot of time figuring out addressability and functionality (in VOD), but am I missing out on an opportunity of scale?"
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