Prior to Parks Associates’ 1st-annual Future of Video: OTT, Pay TV, and Digital Media conference, Colleen Moraghan, Senior Vice President, Data Solutions, 605 shared insights with the analyst team to discuss challenges with growing video entertainment today and in the future.

Colleen will be participating on The New Economics of Video panel on Tuesday, December 11 at 3:00 PM. Panelists joining her on this session include:

Kristen Finney, EVP, EMEA TVD, 20th Century Fox
Chad Harris, SVP New Media & Innovation, Crown Media Family Networks
Michael McCluskey, VP, Product Management, Espial
Steven Schachter, VP of Business Development and Distribution, Cannella Response Television

What is the greatest challenge facing the video industry over the next three years?
The greatest challenge facing the industry will be the costs of creating more quality content for their audiences. A recent prediction from CBS Corp. Chief Creative Officer David Nevins suggests that in just two years, the total number spent on content could grow to $100 billion, with a 70-30 split between traditional TV and tech companies. As the TV marketplace becomes increasingly more crowded with new players, companies will be challenged to maintain their audiences—all while keeping up with the rapid pace of changing technology and customer appetites. If there are no “loyalty hooks”, customers will churn in favor of a similar video service.

What is driving growth in video entertainment today? How does that change over the next few years?
A quote I read years ago says that “digital has done for media what the microscope did for medicine.” Today, we have the ability to use data to better understand the wants, needs, and interests of an audience. Video entertainment is exploding, driven in part by advances in mobile device technology that keep viewers connected and allow companies to meet the customer where they are. Over the next few years, the challenge will be having enough money and resources to keep up with changing technology and customer demands. Tech companies like Google, Facebook and Amazon have very deep pockets to continue to invest here.

What technology will have the biggest impact on your business in the next 18 months and why?
At 605, we measure the impact of TV advertising on consumer behavior—capturing the impact on both brand and sales, unlike more conventional approaches that focus on sales attribution only. We’re focused on using granular data to better inform our clients about how to best reach their target audience – ultimately leading to improved ROI. As the video industry continues to grow, our services will become more in-demand for companies seeking a competitive advantage in a crowded marketplace.

What is the top growth opportunity for content producers over the next few years? What about for cable networks?
The greatest opportunity—both for content producers and cable networks—is leveraging the data available to help understand what content customers like, as well as where and when they prefer to consume it. The biggest challenge will be the costs involved to continue keeping audiences happy at a time when consumers increasingly have a wealth of TV viewing options at their disposal.

What is one thing that the pay-TV ecosystem needs to learn from the online giants in video (Google, Netflix, Facebook, and Amazon)?
Privacy is going to become huge for the pay-TV ecosystem as operators get more involved with data and analytics. Companies must be clear about what customer data they employ as well as how and when they use it. It will be critical to keep up with industry regulations, respect customer privacy and be fully transparent about what data they collect, who is goes to and what is done with it.

What will pay TV services look like in five years?
Multichannel video programming distributors (MVPDs) will continue to face competition from challengers offering streaming TV services and other subscription-based video services. A recent report from the Video Advertising Bureau found that the number of households using only over-the-top streaming services and devices has tripled since 2013, rising to 14.1 million homes, or 11 percent of all U.S. TV households. One advantage MVPDs do have is an existing relationship with their customers, but they will need to work hard to avoid losing them to other services in the coming years.

For more information on the Future of Video, visit: www.fov2018.com.