OTT is more nuanced than you might think. Adding to the complexity, the over-the-top field - the collection of streamers that come through the TV "over the top" of a cable box via the Internet - is getting mighty crowded these days. In the span of a couple weeks, Apple, Disney, and NBCUniversal all announced launch dates for their proprietary streaming services. That expansion has led OTT to include services with no ads, services with ads, on-demand services, live TV, and streamers that combine all of these features.
One highly important distinction, notes DISH Media's Dave Antonelli, director of ad strategy and revenue for Sling TV, is whether these are "premium" services. There's quite a spectrum between the players in the space on the quality scale. The large number of new entrants in the OTT field, combined with a finite number of customers inclined to pay for so many services, means that success for OTT players will likely be "survival of the premium."
What exactly are the requirements to be considered a premium OTT service? There are several attributes.
One is content. "For the consumer, it's similar in content to what you'd expect from a typical MVPD, only delivered over the Internet," Antonelli says. That means brand-name networks and programming that mirror satellite or cable lineups - with the same robust, high-quality feel as traditional television. No user-generated content, no publisher spinoff channel versions, and more programming than just whatever the parent company had sitting on a shelf in a vault.
Additionally, ads that run in this inventory are of higher quality. This is because inventory in premium environments is not offered via an open exchange, but rather through private auctions that preserve brand safety. And ads are more tailored to users in these environments, so they'll see more meaningful messaging from brands.
"Brand-safe means we're vetting the companies that want to advertise, and monitoring what ads run and where," Antonelli explains. "The companies advertising are real, the products are real, and it's all surrounded by programming and other ads that are being held to similarly high standards - particularly when compared to services that simply have an open programmatic option that sell through an open exchange."
The delivery also matters. Because OTT comes over the Internet, providers like Sling can combine the high quality of traditional TV with the user-friendliness of Internet services.
And it's not just consumers who benefit. OTT providers can serve advertisements in some truly innovative ways, deterministically, to registered opt-in subscribers. As reports of ad fraud mount, knowing real people are seeing your ads is quite a draw for advertisers and a hallmark of a premium service.
"Because we have an ongoing relationship with our subscribers, we have deterministic data - we don't infer who they are," Antonelli says. "We also know that we're not running the ads to bots or entities that are not real receivers of the content."
And, like traditional TV, there's a level of transparency that comes along with those brand-safe buys. In other contexts, buying ads programmatically can result in a scattershot approach that makes it challenging to determine exactly where your ad ran, even if it did reach the people you said you wanted to reach. Detailed and transparent reporting, on the other hand, provides information on exactly what networks your ads ran.
Advertisers also win with dynamic ad insertion (DAI), which enables real-time bidding, monitoring, and optimization to ensure a variety of campaign KPIs are met. The size of a service's DAI footprint is an essential element of being "premium," and with live being such an attractive attribute, live DAI adds even more value to the package.
"We've been up and running the longest when it comes to live OTT TV, so we already have live DAI in place," Antonelli says. "We already have more than 95 DAI enabled networks available on Sling, which is a huge draw for advertisers."
Premium isn't limited to live OTT services. Antonelli doesn't consider live TV and live DAI components necessary to be considered a premium service, but says live OTT can provide an advantage in a crowded environment - one in which the average American subscribes to just three streaming services.
When you combine the advantages of premium OTT the result is a more personalized experience, within a quality environment, that is surrounded by the content that has kept audiences engaged for decades through linear TV.
And what's more engaging than premium content?
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