OTT = Opportunity To Triumph
Author: Luke Taylor CCO & Deputy CEO
Date: 6th June 2016
A week or so back, Neural Technologies won a GTB Innovation Awards in London with our long-time partners Safaricom. Winning the award not only made me very proud of the work of both companies but cemented in my mind that Over The Top (OTT) creates real new service opportunities for operators despite views to the contrary within the industry.
In the Neural Global Risk Management Survey 2016, released in January this year, 42% of respondents considered OTT more of a threat than an opportunity, citing the increasing trend of OTT Bypass fraud and customer distrust of Over the Top services as reasons. Whilst these are understandable fears, threats and opportunities often come in pairs in technology, and the revenue opportunities from offering OTT apps, on-demand services and broadening product offerings is significant.
BT’s TV service reported its best quarter ever in September 2015, with more than 100,000 new subscribers attracted to its coverage of Champions League football. It is reported to have signed up 106,000 TV customers in the three months to the end of September, which is the most that BT had signed up in a quarter since the TV service, which now has 1.3 million customers, was first launched in 2007. BT’s Consumer division saw revenues rise by 7% to £1.12bn, fueled by a 17% increase in broadband and TV revenue in the same quarter. That is a lot of people using an OTT service, and impressive new revenue for BT. A real Triumph.
Of course, OTT brings risk management issues – not least fraud – attracted by the fact that the services running over the network are higher value than the network itself. Safaricom reported a 24 per cent jump in M-Pesa revenue to KES19.4 billion ($190 million) in H1 2016, as its active user base reached 15.7 million. These figures are both impressive and undoubtedly orders of magnitude higher than the value of selling basic connectivity services over the same bandwidth.
For more operators to see OTT as more opportunity than threat, It is important that they feel confident to trial new OTT services without fear of fraud. OTT – the Opportunity to Triumph without putting yourself at risk is feasible.