Study Predicts Booming Revenue for Digital Content Operators

Content paid for via carrier billing will provide operators with more than US$14bn in revenues between now and the end of 2019, predicts Juniper Research.

The firm’s research focuses on the global hi-tech communications sector and its analysis, entitled
Digital Content Business Models: OTT & Operator Strategies 2015-2019
, argues that growth will be fuelled by a dramatic rise in carrier billed payments made on devices such as tablets, consoles and smart TVs.

According to the research, existing deployments of carrier billing on app storefronts have produced a marked increase in paid conversion rates – more than 30 times those of credit cards in some instances. They have also enabled first-time monetisation of unbanked consumers and younger demographics.

The greater sophistication of third-party carrier billing solutions now permit subscription billing, allowing for ongoing content monetisation. In addition, many storefronts had found that carrier billing integration resulted in an uplift in average transaction values as well as volumes, partly due to higher sales of bundled in-app virtual items.

The research also found that over-the-top (OTT) content providers such as Amazon, Netflix and Hulu were now adding value to their subscriptions through the addition of original content such as Transparent, Bosch and Ripper Street. It argued that the next step would be the acquisition of major sporting rights, but cautioned that the high cost would be a deterrent at the present time.

“Even for free streamed sporting events, audiences are rarely in excess of a million – to recoup the cost of a successful bid, OTTs would need a paying audience of perhaps 10m in some cases,” says research author Dr Windsor Holden. “But by 2021, when the National Football League (NFL) rights are due for renewal, we would be surprised if one or more OTTs did not bid for an exclusive live package.”

The whitepaper, ‘
Digital Content – An Over The Top Reaction?
, is available to download from the Juniper website together with details of the full report and the Interactive Forecast Excel.

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