Telcos can benefit from the intensifying battle between traditional media players and OTTs by offering services to both parties, according to new research.
Management consultancy Arthur D Little said the total time spent watching TV and listening to radio was increasing in Europe thanks to growth in non-linear services such as VoD.
Its “How to ride the OTT wave” report, which polled 110 media, OTT and telecoms industry executives from 17 countries, said laptops and mobile devices now account for almost half of total time spent on major media.
As a result, about half of the major European TV networks have seen the revenues drop or stagnate since 2008.
Players such as Netflix, Google and Amazon have disrupted all parts of the value chain and their scale is “already an order of magnitude bigger” than traditional players, including telcos.
The combined market cap of Vodafone, Deutsche Telekom, Telefonica, BT and Orange is still less than that of Google, for example.
It is feasible that a few global OTTs could eventually own the whole TV market, ADL warned, and the battle between them and traditional players would continue to inflate overall content costs.
Nevertheless, ADL said telcos could be well placed to capitalise as they have “a key role to play” by offering services to both parties.
For example, ADL said they could monetise data traffic and network quality, the latter particularly with global OTTs.
Further, they could offer distribution, marketing, billing and security services to smaller OTTs, or partner with existing players.
More than half of respondents, 55 percent, said revenues would come from traffic monetisation and revenue sharing.
However, while a majority agreed that telcos would attract additional revenue streams from content owners and OTTs, it is not thought that they would be substantial.
Bertrand Grau, Principal at Arthur D. Little in Paris and author of the report, said a few large telcos could look to acquire media companies, but this is less likely in the short term.
He commented: “There is a window of opportunity for traditional media to partner with telcos to improve their respective position vs. pure play OTTs.”