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Direct-to-Consumer Models Lead Multiscreen Push

Though support for smartphones and other connected devices are helping to underpin traditional pay TV services, the bigger motivation for multiscreen video investments is for direct-to-consumer platforms, according to recent survey conducted by Imagine Communications.

Imagine, which based its study on a survey of more than 400 media and entertainment industry professionals, noted that this motivation is clear amid the launch of OTT services that don’t require a traditional pay TV bundle, such as HBO Now and CBS All Access.

Other key motivators for multiscreen investments included hyper-localized advertising, less reliance on satellite transmission and brand strengthening.

Imagine’s survey also shined the light on the industry’s expectation for the emerging Ultra HD and High Dynamic Range video formats. The biggest concern is TV penetration in the consumer segment, followed closely by upgrade costs. Respondents were less concerned about product interoperability and the stability of HEVC/H.265, a codec that’s about 50% more efficient than MPEG-4/H.264. With all of those concerns factored in, most respondents believe it will be three years or more before UHD surpasses HD.

There’s even less confidence that virtual reality will be the Next Big Thing for the industry. Despite the hype in VR technology and some recent early experiments from programmers and broadcasters, most are skeptical that virtual reality will have a major impact. Most said VR and augmented reality usage will be relegated to niches, with 12% believing they’ll suffer a fate similar to 3D TV, which failed to secure mass-market adoption.

But there’s much more confidence that media companies are accelerating their transition to IP, including operations tied to live production. More than half said they are more confident about the suitability of IP-based, commercial off-the-shelf environments for hosting operations (versus proprietary purpose-built hardware), Imagine found. About 34% said they are planning to speed up that transition.

As for future challenges, the biggest group (27%) fretted about lost ad revenue, compared to pleasing millennials (24%) and achieving cost efficiency (24%).