Over-the-top (OTT) services

Definition

Over-the-top (OTT) services refer to streaming media content delivered directly to viewers via the internet, bypassing traditional cable or satellite television platforms. This model allows consumers to access a wide array of video content on-demand, significantly altering the dynamics of media distribution and consumption. With OTT services, users can enjoy flexibility in viewing choices, often at lower costs compared to conventional TV packages.

5 Must Know Facts For Your Next Test

1. OTT services have significantly increased in popularity due to advancements in internet technology and the proliferation of smart devices.
2. These services often provide original programming and exclusive content that is not available on traditional television networks.
3. OTT platforms typically operate on a subscription-based model, which can include ad-supported options as well.
4. The rise of OTT services has led to changes in advertising strategies, as brands now focus more on targeted digital advertising rather than traditional broadcast spots.
5. OTT viewing has contributed to the phenomenon of binge-watching, where audiences consume multiple episodes or even entire seasons of shows in a single sitting.

Review Questions

• How have OTT services changed the landscape of media distribution compared to traditional cable and satellite television?
  • OTT services have revolutionized media distribution by enabling viewers to access content directly over the internet without relying on traditional cable or satellite providers. This shift has allowed for greater flexibility, as users can watch what they want when they want, often at a lower cost. Additionally, OTT platforms provide unique and original content that challenges conventional television programming, further reshaping audience expectations and engagement.
• Discuss the impact of OTT services on consumer behavior, particularly regarding viewing habits and subscription models.
  • OTT services have significantly influenced consumer behavior by encouraging cord-cutting and changing how people engage with video content. As viewers move away from traditional cable subscriptions, they increasingly rely on OTT platforms for entertainment. This transition has led to the emergence of various subscription models, including SVOD and ad-supported options, making it easier for consumers to find plans that fit their viewing preferences and budgets.
• Evaluate the implications of OTT service growth on advertising strategies within the media industry.
  • The rapid growth of OTT services has prompted a reevaluation of advertising strategies within the media industry. As audiences shift away from traditional TV viewing, advertisers are adapting by focusing on targeted digital ads that can be placed within streaming platforms. This transition not only allows brands to reach specific demographics more effectively but also leads to the development of innovative ad formats that engage viewers without interrupting their viewing experience. The result is a more personalized approach to advertising that aligns with changing consumer preferences.

Related terms

Streaming: A method of transmitting data over the internet that allows users to access content in real-time without downloading it first.

Cord-Cutting: The trend of consumers opting out of traditional cable subscriptions in favor of OTT services and other online media options.

Subscription Video on Demand (SVOD): A business model where consumers pay a recurring fee for unlimited access to a library of content, commonly used by platforms like Netflix and Hulu.