Today’s viewers have a range of reception and display device options. What changes do OTA broadcasters need to make to compete?
The year 2017 began with high hopes for two industry IP standards. One from SMPTE to guide the building of IP infrastructures and another from the FCC for a new OTA broadcast standard. Shortly before year’s end, both were realized.
In October Yospace released a study of the U.S. broadcast advertising marketplace.
Since the start of the 2000s, the US TV market, by far the largest in the world, has been experiencing a period of dramatic change and transformation. Broadcasters are facing intense competition for audience and advertising budgets as viewing becomes more widely distributed across connected platforms and devices, on-demand services proliferate, and competition intensifies. With major internet businesses growing their investments in content and moving onto TV screens, offering advanced, data driven advertising solutions, US broadcasters and MVPDs are having to adapt fast.
Then, just days before the Christmas holiday, PricewaterhouseCoopers issued a report claiming that the percentage of Americans who subscribe to Netflix (73%) is the same as those who subscribe to cable TV (73%). This means that one company, Netflix, has as many subscribers as the entire pay TV industry combined.
Such events mean the pressure on broadcasters and content producers has never been greater to attract and hold viewers. Consumers now have more content choices that can be delivered on more platforms than ever thought possible. A result of these pressures is that content and entertainment delivery is no longer exclusive to OTA broadcasters, cable and satellite companies. There are new players in the delivery space that are more agile, technology friendly, easily available and in some instances less expensive.
Large broadcast and production equipment vendors have eagerly embraced the idea of software solutions.Software-based products allow the manufacturer to make both lower-end and higher-end solutions without the cost of hardware-specific versions. In today’s vernacular, this means IP and cloud products.
Another of the much-vaunted benefits of IP and cloud-centric, software-based solutions is its scalability. If an organization’s needs grow or shrink a software solution can be scaled accordingly.
Software products mean that vendors only have to field one product to cater to users at the low-end and at the high-end. Functionality is simply scaled according to budget and feature set. That is one reason why much of today’s gear has the ability to add new features simply through the purchase of a “license.”
Despite the advantages offered by software solutions, the lack of industry IP and broadcast standards left many potential customers just ‘kicking the tires.’
IP is King
Despite the lack of a clear path forward, several large-scale IP installations (mostly green field) were completed. In November, the Discovery Channel completed the transition of its U.S. networks to public cloud-based origination using an Evertz solution running within the Amazon Web Services (AWS).
The new facility and solution enables Discovery to host and operate all core services required for a linear playout channels in the public cloud. Claimed as a “first-of-its-kind” the playout facility relies on a suite of software and IP based products from Evertz.
Said John Honeycutt, Discovery CTO, “Discovery’s business is more dynamic than ever. In order to distribute content on every screen and launch new and innovative products, the ability to scale our technical operation is critical. A little over a year ago we decided to reimagine what infrastructure could look like by moving to a software and public cloud environment. We had to identify partners that would embrace this new approach to media infrastructure The Evertz solution aligns with our vision of the future, and will enable us to increase operational efficiency, agility and scalability.”
Two Missing Pieces of the IP Puzzle
By year end, the clamor for both an IP standard from SMPTE and for the FCC to approve ATSC 3.0 was at a fever pitch. On the last day of IBC 2017 SMPTE announced the release of ST2110.
The first in what is being called a “family of standards”, the SMPTE ST2110 includes multiple other components. They include:
SMPTE ST-2110-10 is system timing and synchronization or the standard formerly known as
SMPTE 2059 parts 1 & 2 (PTP).
SMPTE ST-2110 – 20 is uncompressed video or VSF TR-03 or IETF RFC 4175.
SMPTE ST-2110 – 30 is uncompressed PCM Digital Audio or AES67.
SMPTE ST 2110 -21 – Packet shaping uncompressed video.
SMPTE ST 2110 -31 – AES3 Audio transport.
SMPTE ST 2110 – 40 – Ancillary Data – also called SMPTE ST 291 or RTP.
SMPTE ST 2110 - 50 – Video, known as SMPTE 2022 part 6 also known as VSF TR-04.
A more lengthy explanation on what the ST2110 standard includes can be found in The Broadcast Bridge resources linked at the end of this article.
FCC approves ATSC 3.0
In November, the FCC approved the ATSC 3.0 “Next Gen” broadcast standard. The key component is that the standard is IP friendly and can support a range of new broadcast services. Progressive broadcasters may seize upon those capabilities to build new business models.
Ajit Pai, FCC Chairman.
Broadcasters had little time to dwell the good news from the Commission. HUB Research published a 2017 report saying that streaming technology had “overtaken pay TV” as the source of viewers’ favorite TV shows. Network programming, the main eyeball magnet for OTA-delivered content, including delivery by cable and satellite, appears to have been captured by streaming technology.
Online has overtaken pay TV as the home of favorite shows. Broadcasters need delivery options to combat this challenge. Source: HUB 2017 Conquering Content Report.
Yet broadcasters have reason for optimism. The Next Gen broadcast standard supports a plethora of new business options. Broadcasters who elect to not implement new services could choose to share a RF channel with another station while broadcasting syndicated content all while collecting a steady stream of advertising revenue.
Progressive companies may choose to use 3.0’s capability to create interactive services. Some stations will broadcast higher resolution imagery, 4K with all the options, HDR, WCG and multichannel audio. Other broadcasters may choose to divide their RF channel into multiple program delivery streams. Perhaps most interesting is that the technology supports mobile reception. Broadcasters now have options.
The past year has been interesting, if nothing else because of the release of two important standards for the production and broadcast communities. Developed solutions for both arenas will roll out in 2018 with first iterations at the spring trade show.
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