How CSPs Can Further Embrace the Content Business

It is incredible how many of the strategic ideas that we were building up since a few years, first with my colleague Jonathan Solomon , and then with the whole team including Stefan De Beule , are coming to reality. Clearly, CSPs, or Communication Service Providers, need to make a strategic and maybe drastic decision with regard to their TV services. While some CSPs will definitely come to the conclusion to exit the content and TV business as a whole; Others will continue to have the sufficient subscriber base and financial power to double down and win big on that business.

The article published today by Digital TV Europe, Deutsche Telekom could launch its own TV alongside STB, presents two outstanding initiatives. These two initiatives have to be considered by any CSP who is seriously considering to prevail in the content business.

The first idea is the move

to become content centric rather than provider centric.

Outstanding!

In a previous post and in many of my executive meetings with several CSPs, I have insisted that exclusive content is a corner stone to the success of any video streaming service. To achieve that, CSPs need to combine content services from different sources. This is called Super-Aggregation, or also Digital Marketplace, which is an broader concept that CSPs are promoting to become a central hub to host digital services, both to consumers and to businesses. My colleague Stefan De Beule has been working with key CSPs to successfully design and launch Super-Aggregation Marketplace types of offerings.

But on top of the super-aggregation, CSPs have to become also a hub for content creators to produce exclusive, highly localized, hyper-pertinent content to the regions and communities that they serve. As a matter of fact, I firmly believe that CSPs have to build the eco-system that enables content producers, creators, and directors to produce exclusive content that the CSP monetizes on behalf of these creators, in either a subscription model, or as a FAST/AVOD (Free Ad Supported TV / Ad Supported Video on Demand).

By creating that eco-system that truly creates value to content creators, who are encouraged by accessing a local platform to create and monetize content. The CSP Subscribers are also served with a great value of exclusive content, that address pertinent topics related to their communities and their up-to-date social, cultural, and political values.

I am currently advising two startups in the content area: One that owns, produces, and aggregates content for a the specific Spanish speaking communities; The other aims at producing highly localized news that are independent, current, and emanating from the community itself as opposed to highly clustered, rarely independent media groups. Imagine how these great initiatives could flourish if they could partner with a forward-looking CSP who understands the value of such content.

With AWS, CSPs can access a variety of partners and solutions that offer the full scope of the media value chain. More details can be found in the AWS Media and Entertainment page. And they can access teams of highly specialized industry experts who can guide them to create a rich content creation, distribution, and monetization eco-system for their markets.

Now the second idea in the article is even more ambitious:

Bandeira said it was difficult to “take ownership” of the ‘middleman’ role without a proprietary device like a set-top.

Absolutely! The battle that CSPs can win is definitely the battle for the last mile. Only the CSP knows precisely what is happening on the last mile network conditions, including the home network. This is why CSPs who invested in great last-mile network quality, in a reliable home WIFI equipment, and in properly collecting and monitoring the right quality of experience (QoE) data are definitely going to have a leverage against other global streaming services. We are also working with CSPs on upgrading and modernizing the Content Delivery Network (CDN), leveraging, including many other technologies, the concept of Edge Compute or Edge Cloud.

But going to the level of controlling the ultimate screen is even a more complete idea that can pay off substantially for operators who know how to incentivize their subscribers to upgrade their TV Sets. The idea is of course not necessarily new. But it is definitely one source of strategic investment that CSPs should consider. Partnering with the right technology providers and OEM vendors could reduce the required investment, accelerate Time to Market, and get more Return on Investment on the long run.

Deutsche Telekom's plan to launch its own TV alongside a set-top box is a clear indication that CSPs need to be content-centric and think outside the box (or in this case, inside the box). By becoming a hub for content creators and taking ownership of the 'middleman' role with a proprietary end-user screen, CSPs can leverage their last-mile network quality and gain a competitive edge in the content and TV business. Telus is another example of a CSP strategy to expand into Health, Smart Home, and Security. Definitely a topic for a future blog post.