If pay-TV providers want to monetize content, eyeballs are moving to mobile screens.MSOs should speak to mobile operators to figure out how to get content on mobile devices in a way that operators can support it. There's a low barrier to entry.

1. © Core Analysis 2014 - Public 1

2. How OTT is Changing the Value Chain
and Revenue Opportunities
Patrick Lopez
CEO Core Analysis
Patrick.Lopez@coreanalysis.ca
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3. Why are we here?
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Ubiquitous fixed
and mobile
broadband
•70% US
households
•100 million LTE
subs US
Large screen
mobile devices
•150 millions
Smartphones (52%
penetration)
•35% adults own a
tablet
Connected TVs,
sticks, consoles
•500 millions
connected devices
OTT explosion

4. TV industry value chain in 2010
4
Content
Production
Studio 36%
TV Channel
31%
MSO 33%
TV
($166Bn)
TV
advertising
($166Bn)
Public
($34BN)
Public
Broadcast
($34BN)
Pay TV
($192Bn)
Content
Revenue
$30Bn $91Bn
$139Bn
$392Bn
Source:DavidMercer,VP,PrincipalAnalyst,StrategyAnalytics,June2011
© Core Analysis 2014 - Public

5. OTT video value chain in 2013
5
Content
Production
Studio 60%
TV Channel
40%
MSO 0%
Web TV
advertising
($4.4Bn)
Public
Webcast
($2BN)
Web retail &
rental
($3Bn)
Content
Revenue
$5.6Bn $9.4Bn
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6. From value chain… To value circle
Traditional TV value chain
• Content is selected, managed and
delivered by MSO
OTT value circle
• Consumers select where to source
the content from and in which form
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Studio
TV Channel
MSO
Consumers
Devices
Studio
TV Channel
MSO
Consumers
Devices

7. Business models and strategies
MSO
• Vertical integration
• Multiscreen
• Social TV
• Go OTT
• Own the network
OTT
• Pay per view, rental, on-
demand
• Subscription VOD
• Free to Air
• Content exclusivity
• Binge watching
• Own the network
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8. Networks and technology
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9. Business models and strategies
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10. Regulatory
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11. Devices
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12. Advertising in mobile
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13. Advertising in mobile
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14. OTT in mobile
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Telecoms.comIntelligenceIndustrySurvey2014

15. Conclusions
• OTT is complementary to pay TV model and
becomes a threat only if:
– Pay TV fails to secure / produce attractive content
– Pay TV fails to create the ecosystem for mobile
monetization, notably advertising
– Mobile ecosystem is ripe and operators are looking to
partner
– MSO / MNO partnership a more natural fit than MSO
/ OTT or MNO/OTT
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16. Contacts
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