For the past couple of weeks, people have expected struggling digital media service Boxee expected to announce that it has been acquired. Boxee has made no secret of its desire to sell after failing to procure funding for its cloud DVR device after a months-long search; however, no such announcement has come from the company.
The sale is rumored to be at a dirt-cheap price, as Boxee’s value has significantly declined in recent years. The company tweeted last year that all-time sales of its set-top box had reached 200,000, which doesn’t begin to hold a candle to other set-top providers.
Jim O’Neill says Boxee simply doesn’t have the market share to compete with companies offering a similar product:
“While it has positioned itself as a potential answer for pay-TV providers looking to provide over-the-top options to their current offerings, there are more established and better-known brands already in that space, options like TiVo and Microsoft’s (MSFT) Xbox.
The OTT space, meanwhile, remains dominated by Roku—which so far has sold some 5 million units—and heavyweight Apple, which sold that many Apple TVs in the fourth quarter of 2012 alone.”
Perhaps the acquiring company can think of some better use for Boxee’s product or simply improve and build on what Boxee has now. Either way, the company’s higher-ups will have a lot of work to do if they mean to bring Boxee into the spotlight.
Apple has given potential cord-cutters two more reasons to consider ditching their cable subscriptions. After expending much effort, Apple TV has finalized a partnership with TV and movie giant HBO, and also with sports network ESPN, as both of the their online streaming platforms (HBO GO and WatchESPN) will now be featured on the popular OTT device alongside Netflix, Hulu Plus, Amazon, and others. This new partnership expands Apple’s potential customer base.
The Apple TV device uses the iOS operating system and can beam both networks to Apple TV via AirPlay.
Apple TV also joined forces with Britain’s Sky News and Crunchyroll, which streams East Asian media. Explicitly appealing to an international audience will only further entrench Apple TV’s position as the market’s top-selling media streaming device. Apple TV sold more units in the first quarter of 2012 that it’s fiercest competitor, Roku’s all-time total sales of 5m+ devices.
Apple TV’s recent developments highlight the continued growth of OTT, as customers are increasingly provided with more content and options.
Referenced from Tech Crunch and The Convergence.
While traditional TV remains the primary medium for video entertainment, innovation from companies such as Netflix is convincing more and more viewers that OTT and/or mobile viewing is the way to go. Netflix recently announced that starting in August it will provide different user profiles for the same account, which will allow users to receive personalized TV or movie recommendations without having to sift through unwanted material provided for other users on the same account.
Such innovations are the driving force behind the growth of Internet and OTT video, which has grown by 54%, while a Nielsen report says the average daily viewing of live TV in the U.S. decreased from 4 hours and 47 minutes in 2009 to 4 hours and39 minutes in 2013.
Substituting OTT viewing for one’s traditional cable subscription, or cord-cutting, is becoming popular enough to threaten TV viewing, according to Jim O’Neill:
“Five years ago, a common mantra in the industry was that cord cutting among pay-TV subscribers was just a blip, caused by woeful economic conditions exacerbated, perhaps, by the rising cost of subscriptions to premium and basic services.
Last month, one of the analysts that had long held that view…released a report that not only acknowledged cord cutting was real, but also said it could morph into a significant threat.”
While OTT providers such as Netflix, Hulu, and Amazon clearly cannot compete with traditional TV on events such as major sports competitions or the evening news, they are threatening to wrest the day-to-day viewing market from the grip of live television.
Popular OTT video streaming service Netflix recently announced its plans to create multiple user profiles on the same account, which will go into effect in August. This will allow each user on an account to create a different profile which contains videos that are personalized only to his or her own viewing habits. This allows personalized Netflix features such as the “Instant Queue” and “Just for You” video sectionsto continue to suggest content to a user without being muddled by other users on the same account.
While simple in nature, the change highlights the importance of content personalization in the online streaming world. Personalized content and video suggestions keep the user engaged and ultimately attain more viewing time for the provider. In the case of Netflix, this means profits in the form of customers continuing to pay for the service provided to them. In the case of free video providers such as YouTube, it means profits in the form of paid advertisements (see “Impact of YouTube’s TrueView for Mobile”).
Creating personalized content, however, remains a developing technology which not only involves observing users’ viewing tendencies, but also uses complex metadata and algorithms to determine the best options for a given user.
Jim O’Neill thinks that “content discovery” is the key for OTT providers to attain and retain users:
“Content recommendation remains a big hurdle for online video aggregators …it’s becoming increasingly important for service providers especially to offer subscribers an easier way to find content… or risk losing them.”