Broadcast Beat Magazine 2018 NAB Show Edition - Page 38

An Adaptive Approach to Redefining Pay-TV By Anthony Smith-Chaigneau, Senior Director, Product Marketing, NAGRA There is not a week that goes by without commentary about the threat to the pay-TV indus- try and the changing view- ing habits of consumers. The considered threat comes from several areas, but most of the discussion focuses on the rise of content suppliers and their individual direct to consumer offers, and the potential for greater choice outside of the traditional pay-TV bundles that entice subscribers away. We are now in 2018 with savvy customers no longer being wooed by a TV offer that states quantity and numbers of chan- nels as a value indicator. Today, people prefer to look for a bet- ter return on their entertain- ment investment and this is the basis of cost dissatisfaction among existing pay-TV con- sumers. This is the momentum causing some to seek a la carte services, applications and con- tent at different price points. However, this still comes at a price, which is not plainly obvi- ous at first, especially when redefining a new household entertainment package that is now described as ‘content stacking.’ The video entertainment mar- ket changes have seen people veer from the complete cancel- lation of cable (cord cutters) to a less-drastic downsizing of services (cord shaving). A growing number of pay-TV con- sumers are opting for smaller, less costly bundles ranging any- where from $10 to $50 a month. The question remains however, are they satisfied with this or do they still add more content on top? Ironically many pay the same as they did before, but now they feel in control and have multiple options to grow or reduce their consumption as opposed to being locked-in to 38 • Broadcast Beat Magazine • content they pay for but have no interest. So, if the value proposition is broken, what is the pay-TV industry doing to adapt to the new market dynamics in order to continue offering their ser- vices as the best value for the money? For starters, providers are responding with a range of packages and services for a lower fee, with no fixed contract or set-up fees. In the process they are adapting to the market needs and re-defining pay-TV. In doing so, they will still have a path for subscriber content growth by innovating content offerings and enticing new con- tent subscriptions as customers realize they still have to invest in a range of additional content. According to the latest find- ings from the Pay-TV Innovation Forum, 92 percent of providers said launching new products