OTT has overtaken traditional TV broadcasting

OTT is the future of tv

The 2020’s, a return to local news and a very bright future for TV viewing

This decade will be remembered as the tipping point between linear broadcast and OTT streaming or TV viewing and the balance of advertising revenues.

In the UK, local TV franchises using traditional linear broadcasting have had 8 years to prove the model, which has failed, in fact, was proven to fail before it started. The OTT offering by View TV Group to bring programmatic ads in hyper-local TV, radio and news across the UK to 997 locations, will reset the scales in favour of local viewing, sponsorship and advertising via OTT.

Even the BBC realises to respond to the likes of Netflix, it needs OTT. Content director Charlotte Moore labeled iPlayer “the heart of everything we do” and will increase access to iPlayer from a month to a year, and then there is Britbox that pulls together BBC and ITV in a subscription OTT model.

OTT TV
OTT TV is the future of Broadcasting – Check out Kapang

In the US, there has been even more re-balancing with Disney+ and Apple TV+ ushered in new challenges through subscription-based streaming TV. Viacom’s acquisition of PlutoTV at the beginning of the year, followed by its subsequent merger with CBS at the end of the year, changed the game of ad-supported streaming. Additionally, the announced launches of NBC’s Peacock and Quibi are laying the groundwork for a very different future for TV viewing.

When looking at the new decade from a local media perspective, advertisers trying to reach hyper-local audiences will continue to re-think and adopt more digital and over-the-top practices. Only those businesses that continue to protect their capital investments in ‘old tech’ will not consider OTT an add-on to their media plans. However, for the enlightened, it will start to re-balance towards OTT to reduce costs, increase programmatic & local ad revenues and reach local audiences who are turning to free streaming services and apps to watch news and entertainment.  

How will this pan out at the start of the new decade?

The new conservative government has got off the blocks at 100 mph and the PM and senior policy advisor Dominic Cummings are prepared to take on old ways of thinking and behaving, including in the areas of digital and media. The proposed changes to DCMS and the challenge of the BBC’s business model are already in their sights. It will not be long before they do that same with the linear broadcast local TV franchises that were handed out in 2012 as none of them have achieved the objectives set out by the government and do not have a sustainable business model. They will probably not be merged or acquired, they will become redundant as other truly hyper-local companies, like Local Media Group and their sister OTT offering; kapang, replace them.

In the US, consolidation will continue with purchases of local TV, radio, and media companies to increase buying leverage and better economies of scale. Several local stations change hands last year; Fox acquired three stations in November and Byron Allen purchased 11 local stations in October. These larger local media companies will look to reduce their digital/adtech vendor count and thereby simplify processes, workflow, invoicing, and reporting. The result? OTT offers, such as kapang that include an end-to-end solution with programmatic ad insertion / replacement, lower costs and just one key supplier. This improves the ability to holistically manage campaigns and generate more efficient results, all while reducing the overall ad-tech tax paid. 

Local advertisers will use more OTT.

The future of local advertising is digital and programmatic. With traditional pay-TV households dropping 4% and OTT households increasing 10% in 2020 (eMarketer), local advertisers must adapt and accelerate their transition from traditional media to OTT advertising. In order to meet this demand, local advertisers will have to increase their access to OTT inventory and leverage their local media company’s first-party data to reach transitioning and new audiences to supplement their linear campaigns.

Development of new technology and products aimed to support local advertisers.

In 2020, we’ll see a continued effort from local media companies to develop and roll out new products for their existing salesforce to sell. Consumers love free local content, and in order to stay engaged and competitive in the face of increasing pressure from the likes of Google, Facebook, and even Amazon, local media companies should consider rolling out local-focused OTT apps to make their unique content accessible to local viewers, especially around news and sports.

For example, Sinclair Broadcasting Corp has developed NewsOn, a free, hyper-local news app that is one of the top most-viewed free apps on Roku (NoCable). However, this is just the beginning. As free streaming content gains market share, there will be even more opportunities for local advertisers to find, target, and generate connections with the cord-shavers and cord-cutters that still want their local content. A great example of this in the UK is out of the same View TV Group stable; knewsy, viewable at https://knewsy.com a hyper-local digital newspaper based on all UK county-based regions and soon, hyper-local to 997 cities and towns

A recent poll from The Harris Poll, found that when it comes to consumers that watch free, or ad-supported streaming TV, 62% of consumers that have a preference between watching local or national they prefer local ads. That number is slightly more, at 68% for consumers that watch local streaming services. This is particularly true for millennials (defined as ages 18-34) who watch free or ad-supported OTT streaming services. They prefer local ads more than consumers ages 55+. 

Increase the efficiency of spend with campaign analytics.

Since local ad budgets are often smaller, local advertisers are more sensitive to waste—whether that be the frequency of the same ads or reaching undesirable audiences—and their reach is often targeted to consumers near their locations. Utilising mid or inflight campaign analytics provides insights for advertisers to make adjustments and improvements of effectiveness and spend on campaigns. For most local advertisers, measurement and attribution on desired outcomes, such as how many consumers visit my location after seeing the ad, is the most important campaign result and in 2020 they will be looking for more accuracy across both. 

The new decade presents opportunities to do things a little differently than the year before. As ad-supported streaming services and apps continue to grow in popularity and businesses begin to realise the benefits of local tv OTT targeting, new opportunities will be unlocked.

Want to know more?  Speak to the team at https://viewtvgroup.com

Written by Dr Jamie Branson

I provide a broad spectrum of news to View TV News whilst taking stories from the public and allowing people to hear about the real news every day of the week. Check out more at https://viewtvnews.com

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