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INTX 2016: SVOD Reaches Its Second Stage

Boston – Netflix, Amazon and Hulu set the stage for OTT-delivered subscription VOD services, but a massive wave of more focused, genre-based has emerged to reach a more targeted audience, and that wave is only expected to get bigger.

That was a big focus here Tuesday (May 17) in a session titled, “Single and Loving It: The Who, How and Why of Standalone SVOD."

The benefits of this approach is that services can be created to target the “super fan” and serve an audience in a unique way that broader SVOD services don’t offer, said Martin Keely, GM of subscription platforms at Fullscreen, which recently launched a $4.99 per month SVOD service.

“We’re just getting started,” he said.

Seth Laderman, EVP and GM of Comic-Con HQ, likened the rapidly expanding SVOD market to a “race,” as everyone attempts to build and launch services for specific audiences, and then get those viewers to actually pay.

But he said there’s some risk involved in targeting niches, because those viewers will also be looking to find similar content from other sources.

There’s an “endless appetite” for premium content, so providers need to rein it in with a curated service,  Ben McLean, SVP of business operations and strategy, digital, at NBCUniversal and Seeso, the new comedy-focused SVOD service, said.

He said offering limitless choice works if viewers know what they want to watch. With Seeso, he said, “We want to [offer] a highly curated, highly-programmed environment” that can engage an audience quickly.

“Seeso is our first swing at this,” McLean said, calling its comedy focus a “large niche.” And expect more. NBCU, he added, is also “looking at digital opportunities across the landscape.”

“There are no more gatekeepers,” said Tom Pickett, CEO of Ellation, a company that produces, designs and helps to market services/brands like Crunchyroll, an Anime-focused service with more than 700,000 paid subs, and Creativebug, a service for craft enthusiasts.

But he agreed that the downside of this second stage of SVOD is the amount of choice and fragmentation in the market, which makes it difficult for a new service to breakout from the pack.

And the technology that underpins these services is as key as the content, David Mowrey, VP of product management at Clearleap, said, noting that more than 100 standalone SVOD services have been stood up over the past nine months.

Not everyone has the resources of  a Netflix to build in all the content protection, interfaces, analytics and billing support. “It’s an extremely challenging thing for a standalone service,” he said. “You need a solid technology partner to do that.”

And the core video service is just one element of these services. To gain and retain customers, SVOD providers must think about “dimensions that go well beyond the video,” Pickett said.

In the case of Crunchyroll, the service is building in additional perks and benefits. One example is its partnership with a service called Loot Crate, which a mystery box of four to six pop culture items. Loot Crate, Pickett said, recently launched a new box focused on Anime, so Crunchyroll offers its subs a $5 discount for it.