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This is another post demystifying technical terms in digital media publishing.

What is OTT? 

The term “over-the-top” has quickly become the signature buzzword in entertainment to describe film and television that is delivered over the internet. There are several underlying factors that continue to influence the inevitable process of “over-the-top” media’s enormous popularization. These factors thus far have helped shape the evolution of “over-the-top” media and will play a major factor in the future development of film and television internet streaming.

For the average consumer, as long as the content plays on their television and with the expected degree of quality, they will be satisfied. For a growing number, the idea of instant gratification by clicking on your favorite movie or show is enough to utilize many of the “over-the-top” services such as Netflix or HBOGo to access content. It’s become the same instant gratification tool as cable. It’s become effortless to access “over-the-top” services thanks to devices such as Chromecast, Roku, Amazon Fire Stick, etc.

“Over-the-top” video service providers such as these have allowed consumers the freedom of choice in entertainment and in many cases at a fraction of the cost over traditional cable or satellite. They are also referred to as “cord cutters,” but these savvy consumers have utilized “over-the-top” services to diminish the need to rely on cable or satellite for entertainment.

The future of over-the-top content, tv, and video

Many cable providers will continue to serve a high functioning role in the further growth and progress of “over-the-top” media if they choose to break their current mold. There is no telling whether that will include a complete “a la carte” option in the future. Many consumers have screamed for that freedom of choice in the past which has led to the “over-the-top” explosion. Before “over-the-top” media, cable and satellite providers boasted their power in numbers. The more channels they can provide, the greater the value they can present to their customers. But as these channels became watered down and less desirable over time, consumers realized that they only watch a handful of channels, not all 300 or 400 offered by the company.

Some providers, such as DirecTV are trying to stay ahead of the game and are not offering a pick and choose “a la carte” option, but rather they have launched DirecTVNow which is live television streaming service. Live streaming television has quickly become the next wave of “over-the-top” media. While providers like Hulu and Netflix have laid the groundwork for streaming television and film content, providers such as DirecTVNow, YouTube TV, and Sling TV have opted to deliver “over-the-top” services in the form of live television as well. Other “over-the-top” live television streamers include PlayStation Vue as well as a live TV offering now from Hulu.

How soon until Netflix throws their hat in the live streaming television ring? Right now they own such a large percentage of the market share there is no consumer demand for them to evolve their services into this. However, if their market share of “over-the-top” services shrinks, don’t be surprised to see a Netflix live TV service in the future.

Digital media is unique in the sense that it’s constantly evolving and at a pace that’s faster than many can keep up with at times. Consumer expectation is a big part that drives the evolution of digital media. Everyone wants to be in the forefront of the next big thing that consumer’s leech themselves onto.

How OTT began 

In the early days of Netflix and Hulu video streaming, networks gave their older shows to the provider and it seemed to pay off as the networks got greater exposure to their programming. This was in hopes that people would see a show on Netflix and be eager to watch new episodes on live television. However, many people became content to wait until it showed up on Netflix. Even if this meant waiting a year for a show to appear on Netflix. This strategy paid dividends for Netflix and as of 2017, they are reporting more than 93 million subscribers around the world.

This is when the networks themselves realized that there is a market for their own personal streaming services. With that HBOGO was born and shortly after that CBS All Access and others are following closely behind them. What does this mean for Netflix, Hulu and Amazon Prime Video? Well, they have been producing their own content and at a rapid pace to keep subscribers’ feeds fresh and updated. Netflix has essentially created their own network inside the platform with an enormously high volume of comedy, television type shows and feature films.

Common OTT Questions

Is “over-the-top” digital media just one service?

There are three main categories (currently) for “over-the-top” media services. The first one being the most common. Subscription-based services include on-demand streaming content such as Netflix, Hulu, Amazon Prime video, etc. as well as the live television providers such as DirectTV NOW and Sling TV.

The second form of “over-the-top” media is actually free. That’s called free and ad-supported services. The most notable of these free services is Crackle, but there are many others.

Lastly, we have the Transactional services. These are services such as Vimeo, iTunes, GooglePlay etc. where you make one-time purchases “over-the-top” to either rent or buy your media. You select individual pieces of film or television instead of subscribing.

Is the OTT market becoming saturated?

This is a two-part answer. In many ways, it’s not saturated yet because there are still plenty of television and film watchers who do not choose “over-the-top” media as their primary means of delivering content into their homes. There is a lot of market share left to seize. However, for the time being, unless more people convert to “over-the-top” media, the market will become flooded with more providers than consumers who are willing to pay. Who will survive? The consumers will make that determination. That’s why expectations are so critical to anticipate because reacting too late can mean that you are left behind your competition. You must stand out in what is becoming a very crowded field that is only going to get more congested as the years continue on.

What is the “over-the-top” growth potential?

The “over-the-top” market has the earning potential to grow past the $158 billion mark by the year 2025. The growth is partially estimated by the anticipated number of cord cutters who will choose to ditch the cable company in favor of subscription-based service providers that give them a more flexible range of viewing options. There are a lot of factors that can determine its growth rates such as the evolution of current and existing digital media platforms. “over-the-top” software development trends will also play a major part in the digital media form’s growth. This is a technology trend that is growing by the day and is expected to continue evolving at a lightning-fast pace.