Over the last few years, there has been a seismic shift in how people consume media. Over-the-top (OTT) media service providers are leading this transformation, allowing users to access media content like films, TV shows and music digitally over the internet, bypassing traditional media and giving rise to the phenomenon of “cord-cutting”. Cord cutting means cancelling your cable TV or satellite TV service.
The growing penetration of smartphones, due to falling handset prices, improved mobile broadband coverage and affordable Internet access have contributed to this phenomenon. Also, the shift to OTT got accentuated in the aftermath of the COVID-19 pandemic as travel restrictions were placed across the world. This shift in media consumption has been triggered by powerful, transformative forces that have disintermediated value chains and fostered innovative new business models for delivering media content. These megatrends, which include an increasingly tech-savvy consumer base, growth in online video, the advent of 5G technology, hyper personalization of OTT offerings and glocalisation initiatives have driven the global media industry into a state of competitive upheaval.
Take a look at the statistics. For Instance we’re looking at Indonesia, the country which experience the phenomenon of “cord-cutting. Indonesia’s over-the-top (OTT) market size is projected to reach at $4,450.61 million by 2027, growing at a CAGR of 33.1 per cent from 2020 to 2027, according to Allied Market Research. OTT content such as movies and TV services are delivered directly over the internet to connected devices such as PCs, tablets, smartphones, and gaming consoles and do not require cable or satellite television subscription. OTT content can be directly downloaded and viewed on user demand. The COVID-19 outbreak had a positive impact on growth of the Indonesia OTT market due to constant rise in demand for over-the-top services. This demand is mainly attributed to continuous growth in online communications services. In addition, use of online entertainment platforms is increasing remarkably through online gaming and over-the-top platforms. For instance, according to the Media Partners Asia (MPA), total online video weekly streaming minutes on mobile grew 60 per cent in aggregate across Indonesia between January and April 2020.
Need for more Agility
OTT media service providers must therefore become more agile than ever in responding to megatrends (both current and future) to adapt successfully to the rapidly transforming OTT media landscape.
“What these trends point to is a strategic shift in their business, which revolves around providing high-quality compelling content, expanding their reach and enhancing customer experience in order to achieve success in the crowded OTT marketplace,” states Setiawan.
To achieve this, a best-in-class IT infrastructure is essential which can enable OTT media service providers to build technology architecture that can support these strategic imperatives. It is here that OTT media service providers’ data center infrastructure lies at the heart of their efforts to dominate an ever-shifting online media landscape.
“Service providers should no longer view data centers as a mere extension of physical infrastructure, but rather an avenue to secure access to media consumers and internet users,” stated Budiman Setiawan – Director of PT Graha Fatta.
Selecting the right data center partner for colocation services is a critical step for OTT media service providers to achieve success in any given market. Three key considerations for selection include the efficient scalability of data center facilities, the presence and reach of network services and the implementation of low latency architecture.
“As CDN provider, it is essential to be able to connect with majority of Indonesian internet users. That’s why we chose Telin to be our DC provider. Telin has a clear presence across multiple regions in Indonesia. These two factors helped our business grow to serve most of the top 20 OTTs in Asia”, points out Setiawan.
With a quickly expanding consumer base, coupled with improving access to digital infrastructure, Indonesia has become one of the most highly sought-after markets for global and local OTT providers. Achieving success will therefore necessitate a data centre strategy tailored to the unique characteristics of the Indonesian market.
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