OTT streaming is often hailed as the future of entertainment media. Customers can now choose between multiple competing platforms and watch the latest hit shows the instant they launch on traditional cable channels.
The new future of OTT streaming revolves around mobile devices — or more specifically, OTT apps. As of 2019, roughly 75% of OTT streaming occurs on mobile devices. Even platforms like Netflix, which customers generally view using home entertainment systems, sees most customers access their accounts from smartphones once a month. And as mobile devices become the default online-connected devices for international users, streaming from smartphones and tablets will become even more prevalent.
I’m Meghan McAdams and I’m Tapjoy’s VP of National Brand Sales. In this chapter of our OTT blog series, we’ll weigh the strengths and weaknesses of popular OTT apps as the market exists in 2019 and offer a high-level picture of what customers can expect from OTT providers today and into the future.
Netflix is the largest and most popular OTT video provider, and with good reason. It was the first brand to successfully pioneer the concept of television and movie screening during a time when its service model consisted of mail-based movie rentals. Since then, Netflix has become a streaming giant with a massive licensed library and an impressive original content collection.
One major reason for Netflix’s success is its comprehensive device support. Customers can watch their favorite shows across desktop PCs, smart TVs, and mobile devices without losing track of where they’d left off. More recently, Netflix has introduced tiered membership plans with SD and HD content packages. Finally, its mobile app has the ability to download a limited selection of movies and television shows for offline viewing — an excellent option for users with limited smartphone data plans.
Unfortunately, Netflix is not without its drawbacks. While its service is available internationally, its licensed content availability varies from country to country — a major inconvenience for travellers trying to watch their favorite shows. From a UX perspective, Netflix’s search feature is unintuitive and poorly optimized. More importantly, new episodes of licensed TV seasons often don’t arrive on the platform until a year after the initial premiere. Netflix remains the king of OTT providers, but these disadvantages have resulted in market vulnerabilities that some competitors have already started capitalizing on.
Hulu is one of Netflix’s biggest competitors in the OTT space. Not only does it offer an impressive selection of licensed and original content, its Live TV subscription packages include 50 television channels — all streamed to their mobile app. That’s a major perk for customers who enjoy parts of their cable package, but aren’t interested in an expensive cable subscription.
Despite these benefits, Hulu’s film and TV selection is limited compared to Netflix. More importantly, the service is geolocked to the United States and Japan, minimizing its growth potential to those regions.
One of Hulu’s most unique features is that it combines subscription and advertising revenue. Users who subscribe to the basic Hulu package pay a reduced fee in exchange for viewing the occasional advertisement. This can be viewed as a benefit or a drawback — many customers are frustrated by ads, but it does provide a lower entry barrier compared to Netflix.
HBO’s critically-acclaimed original content was traditionally funded and monetized using reliable cable subscriptions. This left parent company WarnerMedia understandably reluctant to license content to streaming services like Netflix. As OTT services have become more popular, WarnerMedia opted to launch its own independent subscription service called HBO Now.
HBO Now’s most significant benefit is its original content. This provider is the only United States platform where users can stream full episodes of Game of Thrones, Late Night With John Oliver, or legacy series like The Sopranos and Sex and the City. Since HBO Now is directly controlled by its parent network, episodes can also be streamed the moment they launch on cable.
That being said, HBO Now lacks many user experience features supported by competing OTT apps. Its library is not available internationally, since HBO does license original content to streaming services outside of the United States. Its interface is poorly implemented, and its base price is more expensive than Netflix’s entry-level subscriptions. Then again, customers who want to watch Deadwood fifty times over might find those costs worthwhile.
Amazon Prime Video may have started as a small Netflix streaming competitor, but it’s quickly becoming a major OTT player. Backed by Amazon’s brand and finances, the platform has secured a trove of exclusive licensed content. Its entire library is available as a standalone Prime Video subscription, or unlocked free for current Amazon Prime customers. Prime has also managed to finance critically-acclaimed original series like American Gods, Jack Ryan, and Good Omens that rival Netflix and HBO Now’s output.
Prime’s OTT app goes the extra mile in its user interface. At any time, customers can pause an episode to access actor profiles, bonus content, trivia, and even musical score information. To top it all off, customers can choose to buy digital content that will remain available once the subscription ends.
Amazon Prime certainly does have disadvantages — its selection is lacking compared to Netflix, and its rent/buy services are not universally available in all regions. But compared to other OTT apps, Amazon is investing heavily in becoming a direct Netflix competitor.
YouTube will always be a crucial OTT service thanks to its massively popular, ad-based platform. YouTube TV, meanwhile, is Google’s recent experiment in merging OTT services with traditional cable packages. Its service offers over 70 channels for a monthly fee, including CNN, Fox, MSNBC, the Discovery Channel, and even the Food Network. Smartphone users can also rest assured that YouTube TV has a well-optimized mobile experience and a comprehensive DVR feature that lets you record shows for later viewing.
Despite these facts, YouTube TV remains the most expensive OTT live TV service. Subscriptions cost approximately $50 each month, which is far higher than comparable OTT cable-replacement packages. The interface and viewing experience on non-mobile streaming devices is also limited — which is good news for mobile customers, until you’d like to switch to your home entertainment system.
These are just a few of the OTT streaming services making headlines — platforms like Sling and PlayStation Vue are also worth following. But when it comes to mobile apps, these OTT providers are trend-setters that will determine how the medium evolves over time. Netflix may have kicked off the OTT app market, but it’s far from alone today — which is good news for customers and advertisers alike.
For more information about OTT media services, check out Meghan’s full blog series starting with What Is OTT?