Category: Over The Top Services

MUMBAI: Given how things have unfolded in the last three months, media and entertainment companies foresee a lowered outlook for 2020, will have to review their investments and ramp up capacity to address the challenges, as per a new report by EY titled ‘Building a resilient enterprise- Now, Next and Beyond’. It shows that OTT, gaming, eSports, digital subscriptions and VFX will be most benefitted in the near future while live events, films, sports, out of home and print will be hard hit.

The report adds that digital advertising saw five per cent to 15 per cent growth till 31 May but will drop to under five per cent by 30 June. Additionally, TV subscription will also reduce from minus five per cent to minus 15 per cent in the same time period. However, film will be worse off with minus 50 per cent.

The media and entertainment sector is facing unprecedented challenges from the spread of Covid2019. Rapid changes in consumer behaviour and consumption, stoppages in content production, cancellation of live events and sports and cuts in advertising spend are impacting companies across the ecosystem.

Publishers and media companies are benefitting from some marketers seeing the opportunity but face advertising revenue losses. Film and TV producers are under pressure to mitigate the impact of delayed-release schedules, theatre closures and production stoppages. Companies are currently focused on enterprise resiliency and triaging revenue, but will likely need to turn to rapid cost reduction as business models settle into new norms as business models are not on a solid foundation. Bright spots across the industry include digital pure-plays (such as video gaming) and other virtualised production capabilities, the report said.

The report suggests that for ad revenue, companies should provide ad packages that are “calibrated to the gradual geographical lift of the lockdown as well as reorient ad products and capabilities to build targeted offerings for marketers.” The industry also needs to shift to a big data-based advertising.

As a way to mitigate costs, companies can develop work-from-home strategies and consider real estate cost reduction strategies, with a focus on utilising purpose-built spaces. It also suggests updating the insurance coverage and contract clauses to provide cover for similar events in the future.

Going forward, the report stated that segments such as online education, broadband and internet, hygiene, home entertainment and OTT, e-commerce/home shopping, health and wellness and online banking will see a rise.

For advertisers, EY suggests engaging with marketers to understand changes to media strategy, content and ad placement. Additionally, leverage consumer insights and brand sentiment analyses to better engage marketers and provide targeted packages and offerings. One good source will be to introduce ad spend continuity initiatives.

For content producers, it suggest coming with precaution-led production schedules to get back to shoot. Companies can repurpose their library or acquire content to serve loyal customers with new things. There needs to be more ways to shoot from home and ideation.

Content distributers should look at leveraging digital platforms and OTT solutions to engage consumers and potentially serve as alternative channels for planned launches.