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‘Super Aggregation’ will be Key to MVPD Success in Next Decade

Multichannel Video Programming Distributors (MVPDs) must evolve into “super aggregators” and forge strategic partnerships with historic competitors in order to defend their incumbent positions in the next decade of streaming, according to a new white paper by Caretta Research.

In “How to be a Pay-TV market leader by 2030″, the Caretta team cites the need for MVPDs to embrace “coopetition” with rival video services to counter erosion of pay-TV subscriber bases. The paper notes that MVPDs can smooth customer journeys and improve user experiences by integrating and driving usage of third-party streaming services, even as those services are competing for the loyalty of the MVPD’s subscribers.

“MVPDs start with three significant advantages: a billing relationship with, a direct promotional pipeline to, and valuable data on audiences who prioritise entertainment spend,” said Ed Barton, Research Director for Caretta Research. “To maximise the competitive advantages of incumbency, they should consider super aggregating video and digital services differentiated via bundling, video discovery and unique, local content.”

Caretta notes that realisation of super aggregation objectives cannot be accomplished with near-term roadmaps focused on adding the latest features, but rather through implementation of a strategic, long-term vision of what consumers want and the platform architecture required to address those particular use cases. Optimal solutions must bridge today’s business models with future STB and even STB-less environments, and streamline integration with AI-based technologies and marketplaces to enable rapid and continual innovation cycles.

Caretta posits that architectures that are cloud-native, open, modular, and single instance have the capabilities needed to meet the needs of traditional pay TV audiences while strategically evolving their services to address future opportunities. The scalability, flexibility and extensibility of open architectures enables them to rapidly and cost-effectively experiment with and deploy AI-based tools and technologies that will allow product owners to continually maximise against acquisition, retention, engagement and monetisation goals. This is anticipated to drive:

Improved content discovery via deep linking and metadata aggregation;

Better value propositions via bundled or add-on streaming and digital lifestyle services;

Content delivery and monetisation models that address hyperlocal interest and passion verticals;

New advertising revenue streams, including placements in discovery tools, personalised FAST channels, live events, and more; and

Integration of iOT, gaming and other digital lifestyle offerings to expand subscriber attraction and retention.

“2030’s market leading MVPDs will be built on cloud-native, open architectures enabling strategic optionality and AI-based technologies,” Barton noted. “MVPDs who fail to understand and act on this will be less competitive, will fail to offer superior consumer experiences, and will yield market share to those that do. At Caretta we believe that there will be fewer MVPDs in the 2030s than exist now: those that survive, and thrive, will be those that focus on technology enablement strategies that position them to win now and far into the future.”

The report was commissioned by cloud-native platform provider Quickplay. It is available at https://www.carettaresearch.com/downloads/how-to-be-a-paytv-market-leader.

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