The integration question pulls in elements of many of the technologies trending at the show, most of which centered on applying Internet and IP technologies to the video realm. Cloud-based guides and user interfaces, apps for smart TVs and other Internet-connected devices (read "multiscreen") all had a strong presence. The show also featured a higher proportion of OSS/BSS technologies than usual.
The back office bit is interesting and arguably the most important piece of OTT integration. We'll come back to this - first a little background.
Right now is a transitional time for pay TV. The world is shifting under its feet: OTT aggregators, user-generated content, content owners going direct to consumers, rising programming costs, movement toward a la carte, skinny bundles, etc., all are cutting into the traditional pay TV model. Moreover, these trends can be expected to continue and grow. Thus, it's easy to conclude that the bundle is dying and that the content aggregator role - be it filled by satellite, cable, whoever - is not much longer for this world.
Though that's an easy conclusion, it's also wrong. Here's why.
First off, study after study indicates that video consumption itself is up, especially among OTT viewers, many of whom use OTT to augment their pay TV viewing rather than to replace it. In other words, OTT is more an "and" than an "instead of." True, some people are cutting the cord, but about half of those are doing so for financial reasons - they like the content, just not the price tag.
Secondly, viewing OTT and other alternative video sources is neither simple nor easy today. Video is scattered all over various boxes and devices and dongles and web sites, plus over-the-air and pay TV networks, and it's a great bloody nuisance to sift through it all. It also requires that you know what you want to watch, which isn't always (or even often) the case. Much of the time, even Millennials - the OTT Generation - just want to flop on the couch and see what's on TV.
This is an opportunity. All this scattered content needs to be aggregated into one easy-to-use interface, and cable operators are well-positioned to provide it. Some preliminary moves have already been made; for example, several cable ops have integrated Netflix into their TiVo offerings, and Cablevisionrecently started carrying Hulu. Cloud-based UIs and video apps, plus a big Internet pipe, make it possible to use this same approach with other sources as well.
Content aggregation - the traditional pay TV model - isn't going away. Indeed, there's a greater need for it now than ever before. The difference is what needs to be aggregated and from where. To succeed as next-generation content aggregators, cable ops need to be able to integrate OTT content from all sorts of non-traditional sources - Netflix, YouTube, HBO NOW, wherever - with their own content and into their own user interfaces. That way all the consumer's video content is available in one place, accessible via one remote. The cable operator's.
And that's why the back office is so important. It'll need to be able to accommodate all the provisioning and authentifications for all these disparate things and do so in a way that's easy for the consumer. It'll also need to do it in real time. For example, a customer should be able to add his Hulu subscription or newly discovered YouTube channel app to his cable UI himself, and the back office needs to be smart enough and agile enough to recognize and integrate that addition instantly.
Getting there will be a mighty task and will require considerable coordination with third (and probably even fourth and fifth) parties that cable ops don't normally work with, but it's going to be absolutely essential to remaining relevant in the video space.
