Grass Valley’s Media Universe could be the answer to broadcasters’ revenue challenges.
The pressure to extract more revenue from ever shrinking budgets, due to expensive content rights contracts, is causing Broadcasters to re-evaluate—and in many cases reduce—how they spend their money on production tools and infrastructure. Recognizing this, live production technology providers like Grass Valley are getting “creative” in how they sell their products and cloud-native systems.
That was the message from Tim Shoulders, CEO and President of Grass Valley during a virtual press event in which he described the challenges broadcasters face and how Grass Valley is meeting new lower-operating-cost demands.
“We saw for the first time in 2020 that total advertising for OTT platforms exceeded total pay-TV (cable, satellite) revenue,” he said. “By the end of 2022, OTT revenue will exceed Broadcast TV and pay-TV revenue, so, we’re seeing this shift to OTT platforms happening. It means that operating profits are flat and declining while content rights and production and distribution costs are climbing. This puts a lot of pressure on their operating profits.”
Add to this the complexities of COVID-19 and social distancing that its customers have had a lot to deal with and, more recently, a shortage in processing chips (current demand exceeds total manufacturing capacity) necessary to power many of its solutions, and the content production waters get hard to navigate.
In fact, over the past several months Shoulders has spearheaded an IABM initiative that encourages technology vendors to share components, when they can. In a recent report the IABM reported that 85 percent of its member companies have reported “moderate to severe shortages.”
Shoulders said that Grass Valley and many others are “doing everything we can to keep lead times low for end customers and getting creative about procurement strategies.”
GV’s answer is its GV Media Universe, the company’s vision for transitioning to the SaaS and cloud-based future of the digital media industry with an ecosystem of GV and pre-qualified partner solutions and applications. At the core of the GV Media Universe is GV AMPP, a cloud-based platform powered by a suite of microservices (IT-centric Kubernetes data buckets) offered in a SaaS model that can trigger task-specific processing like video switching or playout based in the cloud. GV AMPP provides “the magic” that holds the universe together. It’s completely scalable in both public or private cloud environments and allows customers to reduce cost and manpower—two expensive commodities.
“The best thing is that it offers benefits for media companies and addresses the challenges,” said Shoulders. “Things like low latency and microservices that allows customers to order what they want and not what they don’t. What they want is an infinite level of customization.”
What the platform allows GV to do is speed up its R&D and introduce new virtualized hardware services quickly. One example is Master Control in the cloud. The GV AMPP platform includes multiviewing and switching, found in most Master Control suites, all running natively in the cloud. There’s no need for localized hardware and it can be managed from a web browser anywhere.
Like many, GV predicts that by the end of 2022, OTT revenue will exceed Broadcast TV and pay-TV revenue.
Earlier this year GV introduced its K-Frame switcher on AMPP. This means that you can now use a Korona or Kayenne production switcher to operate the GV K-Frame. In 2021 the company also launched an audio mixer for the GV Media Universe, called the AMPP Audio Mixer.
Another way GV is helping customers navigate the current highly competitive landscape is to offer Enterprise Pricing Agreements that makes its entire portfolio available in affordable packages. There’s volume pricing, bundling, multi-year agreements and peak management (bursting, for as-needed use). Shoulders said these financing choices help reduce total cost of deployments and add value—when it comes to the ability to manage peak usage. In 2021 five major customers have signed up (representing over $40 million in new revenue).
Finally, Grass Valley is nearly complete with its consolidation of manufacturing resources within its Montreal, Canada-based center (former home of Miranda Technologies) and has increased its investment at centers in Krakow, Poland, and Kuala Lumpur, Malaysia.
“The challenge for the industry is to give customers lower cost tools to do their job as they always have,” he said.
Editor’s Note: When asked about his prediction for attendance at the 2021 NAB Show in October, Shoulders said he expects smaller crowds than usual, based on conversations he’s had with customers.
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