Allen Klosowski, vice president, mobile and connected television at SpotX, examines the many definitions of ‘over-the-top’ content providers.
There is confusion in the marketplace right now over how to define a very short, very simple term: over-the-top (OTT).
Originally, OTT described a service that ‘rides’ on top of your existing internet service — think of something like Hulu being delivered over a Comcast broadband connection. It was originally adopted by video content distributors in the late 2000s as the alternative to TV Everywhere (TVE), a similar concept but offered only to the subscribers of the service provider.
Essentially, cable, satellite and telcos could only offer TVE to their in-market subscribers, but could offer these OTT packages to anybody’s subscribers, and so could upstarts like Netflix. The term was coined well before the mass proliferation of smart televisions and media streaming devices that we see today.
As OTT has exploded, the meaning of the acronym has morphed. I could compare it to your phone. Your ‘phone’ is really now an untethered go-anywhere camera, video recorder, video player, audio player, GPS device, text and email supercomputer in your pocket. This is far from the roots of what existed 100 years ago, but it still does retain the characteristic earphone and microphone that led to its name. While it’s technically a ‘smartphone’, we’ve moved past that stage in adoption and now just call it by commonly accepted ‘phone’.
In the past three months I’ve asked more than a dozen senior people at events across the US, Europe, and Asia to define what ‘OTT’ means today. Surprisingly, I’ve received a slightly different answer each time.
Here’s a sampling of the responses I’ve seen so far from brands/agencies, technology solution providers, demand-side platforms, trading desks, media owners, MVPDs, operators, and broadcasters.
1 – OTT is another term for video delivered to connected televisions and smart televisions
This includes video delivered over the public internet from any source, including user-generated content. In this context, OTT is defined as the end device, and not the content type or origination source. This includes gaming consoles, streaming devices, smart televisions etc.
2 – OTT is broadcast quality video delivered to connected and smart televisions
This definition would thereby exclude YouTube or similar services, because it’s not ‘broadcast quality’. When I asked if the new YouTube broadcast service would be considered OTT, then the answer changed to yes, that would be considered OTT. If YouTube has an app that delivers both, then it’s a mix. In this context, OTT is about the device and type of content.
3 – OTT is long-form video delivered to connected and smart televisions
In this scenario, the producer of the content is not a factor, but instead the fact that it is long-form content, live stream, or full episode. It doesn’t matter if it is user generated or developed by a professional studio. This definition gets confusing, because an offering that mixes long and short form would then have to classify the content differently. Buyers looking for OTT content would only be eligible for the long-form, and short-form would have to go by another moniker.
4 – OTT is broadcast or premium quality video to any device, delivered via the public open internet and not through the MVPD or cable provider infrastructure
This view is that OTT is defined by the ability to access broadcast quality content across all devices via standard internet protocols, instead of the proprietary broadcast protocols and dedicated infrastructure of the provider. So new cable or ‘skinny’ bundles are OTT, even if you are watching them on your tablet, mobile phone, or through your Roku connected to your TV.
This also aligns with early TV Everywhere plans from seven years ago that were more focused on web distribution than connected televisions and mobile devices, and also aligns with how many major providers openly use the term to discuss video delivery on mobile platforms.
5 – OTT is any content delivered by the standard public open internet, instead of proprietary broadcast protocols and infrastructure
This is the most clear definition, because it aligns with the definition of ‘over-the-top’. It means that the information packets are delivered over-the-top of the cable operator infrastructure in an IP enabled fashion.
For example, while broadcasters consider video delivered over the internet to be OTT, mobile operators consider messaging delivered via IP such as Skype or iMessage to be OTT. They also put Netflix and Facebook in the same category of OTT. But that’s odd, because a connected or smart television doesn’t have anything to do with mobile operators, messaging apps, or social media networks.
That breaks definitions 1-4, and is also what we see being advertised by many online video players, such as Kaltura’s OTT Now service which focuses on video across all devices.
6 – OTT is direct to consumer offering across all devices, without broadcasters, telcos or cable providers controlling distribution or billing
This would be something like Netflix, YouTube or iMessage, because it’s a service that is provided directly to the consumer, and disrupts traditional locked distribution and billing methods in favor of using the open internet for delivery and direct consumer billing.
This is not my favorite definition, because I we see traditional players like Centurylink embracing OTT as a potential replacement for their existing IPTV infrastructure. But then, I’ve also seen the argument that it’s not OTT if you have to pay a traditional provider for the access, regardless of how it’s delivered.
Why is this a problem?
This is a problem because right now in the market, in order to have a fair exchange between buyers and sellers, we need a common definition that accurately describes the goods being bought and sold. In this instance, OTT has been muddied by every interested party leveraging the term for their own press releases.
If the agencies and media planners don’t know exactly what OTT stands for, how can they adequately value and buy it? Obviously working in programmatic direct scenarios, where buyers and sellers are negotiating deals directly, communication occurs which clarifies the exchange. But even the platforms themselves, such as ad servers and demand-side platforms, need to be able to put the inventory underneath a checkbox in their interface to allow the deals to start to flow properly.
How it should be
Maybe I’m a purist about the originations of the term OTT, which was more focused on web viewing than anything to do with the devices themselves. I believe that OTT should be defined as the delivery method – it is content delivered via the open internet, more in line with definition #5 above. Using that definition, it’s easy to very accurately describe the transactional framework and environment for buying and selling video ads.
1 – As a buyer, I want to purchase mid-rolls in full-episode live broadcast OTT video on mobile and desktop devices.
2 – As a seller, I have long form OTT mid-roll placements available on mobile applications, connected television, gaming consoles, desktop web, and some proprietary set-top-boxes.
3 – As a technology provider or platform, I understand OTT as the delivery method and know that standard internet methods give me real-time two-way communication with the end device, whatever that device may be.
In this use case, OTT differentiates the ad delivery method versus IPTV, HbbTV 2.0 or ATSC 3.0 – which are all valid ways to do fully-addressable advertising to a device, but each very different in implementation and scope.
The people with digital backgrounds take the idea of OTT for granted, because they have not yet been exposed to the broadcast specific environments. For them, ‘OTT’ is inferred on every transaction. Media buyers with TV backgrounds will know these terms can make a big difference on execution of a campaign.
In the above scenarios, each descriptor is unique and specific, allowing buyers and sellers to get exactly what they are looking for from the content, placement, device, and delivery method.
It’s all very clear what everyone in the transaction ultimately means. But unfortunately for now I’d be outnumbered.
How it is
A ‘lingua franca’ is a common language used between people who speak different languages to communicate. In this case, it’s the digital, broadcast, agencies, and technology providers trying to come to common ground. As a result, we’re seeing standards bodies like the MRC and IAB come to the following definitions.
Over the Top Device: A device that can connect to a TV (or functionality within the TV itself) to facilitate the delivery of Internet based video content (Roku, Apple TV, Smart TV’s, game consoles, etc).
Over the Top Video: Video content transported from a video provider to a connected device over the Internet outside the closed networks of telecom and cable providers.
So for now I’d say the standards bodies have spoken to say that OTT means video delivered only to ‘OTT devices’ that are connected to a television, or a smart television itself, via the public internet, regardless of the type of content. That puts us at a working definition that is a blend of definition #1 and #5, and I think it pretty much sums up the common usage.
While I may not totally agree with where the commonly used definition of OTT has landed, for the sake of the industry we should all get on the same page so we can formally establish our lingua franca and move on.
But more importantly, perhaps as an industry we should stop delineating audiences by distribution channels or live/linear/on-demand.
With content no longer limited by distribution providers or devices, if you’re looking to engage viewers based on first-party proprietary data, why delineate audiences based on whether they’re watching the EuroCup through a cable box or an app? The future looks interesting indeed.