Content Everywhere: a look back at 2023

The impact of AI

It would be impossible not to mention the impact of artificial intelligence (AI) on the media and broadcast industry this year, as noted by a number of commentators including Tom Dvorak, co-founder and CCO of XroadMedia.

“We can’t talk about this year without mentioning AI. Everyone wants to be seen to be using AI, significantly when it comes to user experience. In particular, we’ve seen more services prioritise personalisation with the use of AI. Generative AI and the use of natural language are used to help services connect with their audiences, with more accurate segmentation, customised thumbnails and curated playlists,” Dvorak says.

Peter Dochterty, CTO and founder at ThinkAnalytics, agrees that generative AI likely tops everyone’s list of hot trends in 2023, and provides some examples of how his company is deploying it.

“We got an early head start with preview access to Amazon Bedrock and have made significant progress working with customers to add new ways of engaging with viewers using generative AI for personalised recommendations using natural language. Generative AI has also resulted in another development: creating cross-channel advertising and marketing campaigns that are personalised based on user behaviour,” he says.

Bart Lozia, CEO of Better Software Group (BSG), further observes that in the context of streaming and over-the-top (OTT) platforms, “the role of AI in 2023 was transformative, marking a new era in content delivery and audience experiences”.

Lozia went on to say that one of the most important applications of AI on OTT platforms is content recommendation and personalisation.

“AI algorithms have become extremely sophisticated at analysing viewer data, understanding preferences, and suggesting content that keeps viewers engaged and subscribed. AI tools are also being used to analyse viewer trends and preferences, which in turn inform the development of new shows and movies. This data-driven approach to content creation is revolutionising how stories are told and produced,” he says.

Martin Prins, head of product at Media Distillery, adds that with tools like ChatGPT becoming widely available, more people have now had hands-on experience with AI.

“They see that, although it may not always be perfect, it has already found many major uses and benefits, also in the media industry. Before 2023, many video services showed interest in AI, but it was not always part of their strategy. As the people in boardrooms now also experienced what these tools can do, AI adoption has found its way on many roadmaps,” he notes.

Jane Sung, COO of Cinedeck, agreed that AI “has been the talk of the industry in 2023, with the increase in popularity of AI platforms and integrated features re-writing the future of broadcast and media. Particularly in post-production, the hype surrounding AI and machine learning, and the integration of features with these capabilities, has already started to change the game for content providers in the industry.”

“While more consumers are turning to FAST as a more affordable option, media companies are realising that this model has made it more cost-effective to acquire content and monetise their libraries. The industry has adopted more creative ways such as hyper-localised content to engage audiences, including younger demographics,” - Rick Young, SVP and head of global products at LTN

Sung also notes that with the rise of AI and ML features in broadcast and media, automation has begun to increase in popularity too.

“The post-production industry has already started to thrive in this area, with more and more providers making the effort to implement automated tagging, captioning and editing solutions into their existing workflows. This has been particularly prevalent in the announcements of media asset management solutions and editing platforms, which have been implementing automation features throughout 2023,” she says.

Ajey Anand, CEO of Norigin Media also points to the growing impact of AI on streaming TV.

“With many digital platforms and social media apps already adopting machine learning and AI to improve consumer experiences, there has been a lot of progress in 2023. Whether it’s sports streaming apps or D2C OTT apps from broadcasters, AI is not only helping create some great UI & UX, but also introducing a whole new era of search and recommendation which actually works and increases retention. AI has also helped new use cases including interactivity for audience engagement on connected TVs (CTVs) and streaming apps,” he says.

Gatis Gailis, CEO of Veset, comments that 2023 has been the year of automation and the normalising of AI and ML implementations amongst the broadcast and media industry. “With the rise of independent AI platforms, such as ChatGPT, taking storm, organisations throughout broadcast and media have been quick to move towards implementing AI and ML wherever possible,” he says.

Meanwhile, Michael Lantz, CEO at Accedo, argues that while generative AI is still in its infancy, there have already been some interesting experiments from across the media and entertainment industry.

“This includes a number of emerging initiatives to use AI to support content production. These experiments have demonstrated that there are a huge plethora of exciting opportunities within the sector that can greatly benefit from this technology. AI will make it easier, quicker and eventually significantly cheaper to produce high quality content. While this development is certain to see its share of challenging rights management and protests from a conservative industry, I have no doubt that we will see an immense amount of further innovation and use cases which we have not even considered yet,” he says.

Lantz adds that he’s “also a firm believer that using AI to analyse user behaviour will mean that video providers are able to more easily introduce highly personalised services to an extent which has not previously been possible. This improved understanding of consumer behaviour and preferences will offer both the possibility of adding new revenue streams, as well as more loyal and engaged consumers.”

The FAST effect

Johan Bolin, chief business officer, media and broadcast at Agile Content, highlights hybrid content monetisation among his top trends for the year, noting that the “emergence of hybrid models blending subscriptions and advertising is reshaping content monetisation. Viewers are increasingly offered choices between ad-free paid content or ad-supported free content within the same service.”

FAST, or free ad-supported TV, has certainly been a particular buzzword this year. However, Media Distillery’s Prins warns that there is a lack of public data that shows whether or not FAST services are profitable.

“It remains to be seen if FAST can be successful in all markets, as several markets for instance already have a high-quality free (public) offering. We have already seen several FAST services struggling to sell their ad inventory due to a lack of viewing or advertiser interest. I believe the realistic answer is: that there’s no magic single solution to having an engaging and profitable video service and services should keep discovering what works well in their markets. Only time will tell,” he says.

Paolo Cuttorelli, SVP, APAC & EMEA at Evergent, agrees that there is a rapid shift toward mixed monetisation models as consumers look for more affordable access to high-quality video content via AVOD and FAST services.

“Experimentation is key to engaging the widest audience possible while finding the most profitable distribution channels, but media companies need the flexibility to deliver and monetise a range of new services quickly and efficiently. As a result, many operators are looking to become super aggregators of their own and other streaming services to increase retention and recover ARPUs lost in the shift away from traditional pay TV. Agile cloud monetisation and advanced revenue management capabilities are helping content providers deliver increasingly complex global distribution strategies while unlocking growth in new markets,” he says.

Norigin’s Anand adds that as with linear TV, “FAST channels help content discovery and conversion to VoD consumption. FAST also provides an opportunity for niche content creators to create TV channels with scheduled content that allows them to be available on larger platforms and CTVs like Samsung TV Plus and Roku channels”.

Gailis from Veset believes that 2023 “has seen the growth of FAST channels, and the recognition of ad-tech and monetisation as a non-negotiable feature in content delivery. As content consumers move more towards fast-paced, AVOD viewing scenarios, broadcast organisations have been learning to adapt for success as a result. This has seen the rise of products and solutions that incorporate monetisation, FAST and AVOD capabilities.”

Rick Young, SVP and head of global products at LTN, also agrees that FAST channels have continued to increase in volume this year.

“While more consumers are turning to FAST as a more affordable option, media companies are realising that this model has made it more cost-effective to acquire content and monetise their libraries. The industry has adopted more creative ways such as hyper-localised content to engage audiences, including younger demographics,” he says.

Young adds that the rise of FAST channels “has also seen a growing number of streams dedicated to sports, even though sports broadcasters were slow to embrace the trend. Over the next 12 months, we will continue to see greater investment in streaming sports and taking advantage of its monetisation opportunities. Major networks and digital-native platforms will continue to put money on the table to secure live sports rights whether it is as big as soccer or as niche as fishing. FAST channels have created a home for all sports.”

XroadMedia’s Dvorak also notes that it has become apparent that one business model is not enough for even the significant drivers within the industry to thrive with one revenue stream.

“This year, to survive within the turbulent market, service providers have been pivoting to different models, such as SVOD offering AVOD tiers or AVOD diversifying to provide FAST. FAST has continued to explode in popularity, with the cost of living being a main driver as users want to save on their monthly costs. Providers are beginning to consider the next stages of FAST, especially how to add personalisation while keeping with the casual viewing,” he says.

Vladislav Georgiev, marketing manager at MediaHub, observes that the industry “is shaped by two major trends: the rise of new technologies and the slowdown of the global economy. The OTT and IPTV services bring quality content combined with more control of the service by the end-customer. Gaming and audio content will also contribute to more screen time, but this is not the case for TV content creators. On the other hand, the number of customers of pay-TV services is declining and the audience of the FAST channels is growing.”

Going direct

The rise of direct-to-consumer (D2C) streaming presents huge opportunities for sports organisations to build closer relationships with fan communities while driving new revenue streams, according to Evergent’s Cuttorelli.

“Many forward-thinking players are now harnessing data insights and creative monetisation strategies to foster a deeper sense of community engagement, keeping fans engaged all year round with personalised offers and tailored subscription options that drive platform loyalty while adding up to significant improvements in profitability,” he says.

Prins from Media Distillery warns, however, that making subscriber-based D2C services profitable is a big challenge.

“After a period where people had to stay at home due to Covid, and triggered by all the subscription price increases, viewers have put more scrutiny on the amount of subscriptions they are willing to pay for. To prevent churn and increase revenue, many services are exploring ad-supported models to be able to make services profitable. The demand for novel ad-based approaches is increasing, something we address with the Ad Break Distillery product that we launched this year,” he says.

Fully immersed

Meanwhile, interactive TV and immersive experiences are cited by several companies as growing trends this year.

BSG’s Lozia says we have seen significant growth in immersive media in 2023. “Technologies like VR and AR extend beyond gaming into mainstream media consumption, offering viewers innovative and interactive ways to experience content. This opened up new possibilities for storytelling,” he adds.

Antonella Lorenzetti, head of marketing at nanocosmos, observes that in the ever-evolving landscape of streaming services, “the past year has witnessed a whirlwind of trends transforming the viewer experience with unprecedented speed. One of the most notable trends is the rapid growth of interactive use cases. Microbetting for instance was barely known a year ago; now it is a huge thing in monetised content streamed with ultra-low latency”.

She adds: “The demand for interactive content is growing while the expectation to deliver high-quality interactive scenarios persists. Our recent collaboration with Live Wegner exemplifies this, [such as how] a live auction with multi-camera perspective can compete with the in-person experience.”

Bolin from Agile Content also says there has been a surge in interactive TV experiences, “notably in sports content. Providers explored enabling viewers to actively shape their viewing, allowing influence over elements like camera angles and even storylines. This trend personalised the viewing journey and deeply engaged fans.”

A sporting chance

Bolin also points to the degree to which streaming platforms embraced sports. “Major streaming services, such as Netflix, delved into sports content, recognising the increasing demand. This move disrupted traditional broadcasting models, marking a shift in their offerings,” he says.

However, Simon Brydon, head of sport – video network, at Synamedia, warns that it has also been a testing year for sports broadcasting in particular.

“There has been growing unease about the lack of broadcast competition in several markets, flat-lining fees outside the US, and many streaming platforms under economic pressure because of slow subscriber acquisition,” he says.

Brydon adds that the broadcast rights market for many sports, especially top tier football, has been struggling. “The uplift in US rights fees for the NFL and the NBA are bucking the trend as fees in general are flat or reducing. For example, Serie A’s new five-year deal in Italy was down 2-3% on the previous agreement and Sky Italia didn’t bid aggressively, settling instead for a limited number of non-exclusive games. The big question is what appetite Amazon, Apple, and Netflix will have for entering or staying in the ring for Tier 1 sports,” he comments.

Wider trends

Commentators also point to some of the wider economic trends that have affected streaming this year.

Accedo’s Lantz says the shifting economic climate and associated uncertainty “has led a large proportion of video service providers to dramatically pivot their strategy, focusing more on profitability, and less on growth”.

He adds: “While this makes a lot of sense as a long-term strategy, and is even more important in a world where cost of capital has increased over the past couple of years, I think the industry is currently driven by a misinformed view that we have exhausted avenues for growth. Indeed, the latest Netflix report goes to show that there is plenty of room for acceleration so while profitability is key, these services should also be looking at how they can attract new viewers and extend their offerings. Going into 2024, with more normalised macro-economic conditions, I believe the overall OTT industry will show resilient but not explosive growth, and we’ll gradually see a return to a growth focus again.

LTN’s Young also comments that more media companies have been looking at ways to drive more value through technology.

“Macroeconomic headwinds have meant that media companies have fewer teams to run systems internally. With budgets and time only getting tighter, companies are turning towards transformative media technology providers to help them tie the pieces together. By unifying workflows through a technology partner, media leaders are able to drive efficiencies and navigate complexities. These advantages have helped organisations to focus on what they do best – produce high quality content for their audiences,” he says.

Synamedia’s Brydon further observes that “chasing turnover for vanity has become chasing profit for sanity. In a hugely competitive market with a multitude of available services, operators have been increasingly keen to re-evaluate their business models and cut costs to lower total cost of ownership”.

In his view, the “silver lining for technology vendors is that solutions that ease and speed deployment and can be adopted on a case-by-case basis have come into their own. The shift to the cloud and multi-tenant SaaS solutions has continued unabated in 2023 because it makes great commercial sense by offering the flexibility and agility operators need. Reliability at any scale is increasingly critical and we’re proud that all of our 26 customers with SaaS solutions in the cloud had zero interruptions this past year. 100% reliability is a record we’re confident we’ll be repeating in 2024.”

In addition to the macroeconomic impact, others point to developments such as the rapid evolution in content personalisation.

According to BSG’s Lozia, “viewers increasingly expect content that meets their unique tastes and preferences. Technological advances have enabled platforms to tailor content selection to individual viewer profiles more effectively than ever before. The level of customisation includes things like user-friendly interfaces that adapt to viewing habits and personalised episode playlists based on viewer history. Additionally, there is a growing emphasis on interactive content, where viewers can choose story paths or endings.”

Sung at Cinedeck also cites changes in workflows, which she says are being built to incorporate more automation in post-production and have therefore naturally become more hybrid than ever before. “Editing and post-production is now more adaptable, and often remote to an extent, with much further reach and transportability for the organisations providing the editing and post services,” she says.

Cuttorelli at Evergent raises the problem of subscriber churn, which he says remains a critical challenge for media companies.

“Today, consumers have more choice than ever and can easily cancel and sign up for a different video service in a matter of moments. Content providers are quickly realising they need specialist tools and data-driven strategies to address all forms of churn, whether involuntary (e.g. when a subscriber’s card payment is declined) or voluntary churn (e.g. choosing to cancel a service). Increasingly, streaming services are harnessing predictive AI-powered tools and flexible monetisation strategies such as intelligent payment recovery features, pause and resume options, or step-down payments to proactively combat churn and maximise user retention,” he says.

Anand from Norigin, meanwhile, observes that the connected TV market is becoming increasing fragmented.

“The race for the living room is only heating up more than 10 years after the launch of the first Smart TVs in 2012,” he says. “While Samsung and LG seem to have global dominance with their individual and unique operating systems, they are not yielding to the dominance of the Android OS on CTVs. We have seen Hisense and Philips starting to diverge from the Android OS too, to their unique choices which further fragments the CTV space. While Android remains the largest App store, only the strongest will survive, as we have seen with Samsung Tizen cross over 50 million households in Europe in 2023. Companies like Roku, Amazon and Vizio are spending most of their efforts in the USA, we can only assume they will expand their markets or we anticipate large announcements in 2024. We have had a taste of this already now in 2023, with the highly anticipated launch of the Vega OS from Amazon / Fire TV.”

It would of course be remiss not to mention the implementation of 5G, which Gailis from Veset says is another exciting conversation amongst the industry with possibilities for the future of bandwidth and content delivery performance. “For content delivery organisations, the idea of reducing bandwidth and increasing quality is a promising one,” he says.

Sustainability has risen up the agenda

Sustainability remains an incredibly important topic for the industry as a whole, and it was surprising that it was cited by so few commentators. However, Lantz from Accedo says it was clear in 2023 “that the wider industry has properly woken up and is beginning to take sustainability seriously. This may in part be due to the upcoming regulations which will see businesses in all regions having to put it on their agenda, but the effect is still wholly positive.”

Increasingly, he adds, “the entire media ecosystem has started to take a closer look at its own footprint, and we are also seeing more investment in sustainable content and campaigns … The media industry has a responsibility to not only make itself more sustainable, but to use its influence to create a more sustainable world so it is great to see how broadcasters are starting to step up to that challenge.”

It’s a good note to end on for this year. Wishing you all a very merry Christmas and a happy and successful new year. The Content Everywhere newsletter will be back in January, when we’ll be asking companies to provide some of their predictions for the coming year.

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