Consumers don’t watch TV like they used to—and pay TV operators know it. Over-the-top (OTT) subscriptions are on the rise and pay TV subscriptions are trending downward, making customer retention more crucial than ever.
Pay TV operators are taking action, and executives from North America, Europe and Australia discussed how they’re winning over customers and more at “The MVPD Roundtable: Innovating in a New Age of Television” session at The Pay TV Show.
Addressing Cord Cutting Fears
If you think cord cutters are the primary demographic pay TV operators want to win over, you would be wrong. In fact, it’s “cord nevers”—18- to 24-year-olds who have never had a pay TV subscription—that present the most challenge and opportunity.
Michael Ivanchenko, Group Director of Product Design and Development at Foxtel, explained that it’s been difficult trying to communicate the benefits and features of pay TV.
“A lot of our people that we’re trying to market to don’t know what a DVR is, let alone a VCR,” said Ivanchenko.
Bob Greene, Managing Director of Business Development at Liberty Global, responded that cord nevers have been exposed to pay TV, they just haven’t paid for it.
“I’ve got two of them at home,” he quipped, to laughs from the audience.
But more seriously, the age of the consumer isn’t the important part.
“It’s not so much that they’re a cord cutter or a cord never; it’s how can we provide the best content to them,” said Greene.
And a key part of providing the best content is delivering an integrated, seamless experience.
Integration and Aggregation
Pay TV operators have long served as content aggregators, providing sports, news, premium cable shows and other content.
More recently, they’ve had to decide how to work with OTT entrants like Hulu and Netflix. And the pay TV executives seemed open to the opportunity.
“Having an integrated environment is actually a very positive thing,” said Greene.
Gary Schanman, SVP Video Products at Charter Communications, explained that providing all the content consumers want to watch in one place creates a better customer experience.
“Consumers are watching the same amount of content,” said Schanman. “How can we take the friction out of getting other services? To us, integrating with Netflix is pretty natural.”
Pay TV operators are also exploring how they can provide easier access to other technologies, like Apple Air Play and Bluetooth. At Sky TV, they’re doing exactly that.
“We’re finding other ways to make the [set-top] box useful,” said Andrew Olson, Executive Vice President for Strategic Innovation at Sky. “It’s that seamlessness of everything, and there’s still more things to do for sure.”
What Consumers Want
One key theme each of the executives touched on was delivering a personalized experience for consumers. It’s not just about having all the content in one place—it’s making it easier for them to find and customize it to their tastes.
“There’s something for everyone,” said Ivanchenko. “It’s about understanding what each person is interested in.”
But it shouldn’t be hard to consumers to find what they want to watch. Sky’s Olson explained that consumers don’t want to jump from Netflix to Hulu to Amazon Channels to find their favorite show.
“When I sit down at that screen, you’re going to show me something that I want to watch because you know me,” said Olson.
Ultimately, pay TV operators will have to prove to consumers that they not only have the content they want to watch, but that they can deliver it how, when and where they want to watch it.
“We love the fact that people love content,” said Charter’s Schanman. “Whether or not they get it from us, that’s the challenge we have.”