Wednesday, June 3, 2015, 8:10 AM ETPosted by:John Luther
SVP, Product Strategy, JW Player
Apps are everywhere. Apple's tremendous success with the App Store, quickly followed by Google Play and others, popularized a model that has resulted in apps not just on our phones, but also on game consoles, TVs, watches...even in our cars.
Yet while native mobile apps (in contrast to browser-based web apps) offer a number of advantages to brands as well as consumers, many developers and device makers seem to think the app model can simply be cloned in other industries with the same success.
They are wrong. In fact, I think that our obsession with native apps is holding back widespread OTT adoption - for both brands and consumers. Native Smart TV apps are expensive to build, hard to maintain and represent an investment of time and resources that many content providers are unwilling to tackle.
While mobile apps run in a native operating environment (i.e. iOS/Android), there is no common native operating environment among OTT devices. Thus, content providers that want a true OTT strategy must develop and maintain an app for every single platform: from Apple TV to Samsung Smart TV, XBox, Fire TV, and so on.
But the drawbacks of native Smart TV apps do not end with the costs. They also deliver a poor user experience. Beyond the annoyance of having yet another app in their lives that users must keep up-to-date, many Smart TV apps have terrible interfaces for lean-back, large-screen video viewing. Smartphone apps offer streamlined, touch-based control, but Smart TV apps force either TV-like or D-pad/single-button remotes on users, which are cumbersome and make navigation frustrating.
So it's no surprise that - despite the hype - OTT is taking off only in fits and starts. With poor UX and long and costly development cycles, native apps are an expensive roadblock to an OTT strategy. But there's still clearly an appetite for cord-cutting on all sides: both content providers and consumers will benefit from cheaper and more flexible content options. We just need a solution that makes sense.
A far more cost-effective and consumer-friendly solution already exists, but has been largely overlooked by content providers distracted by the hype surrounding the native app model - as well as self-interested hardware manufacturers who benefit from app store ecosystems.
I'm referring to casting - "sending" or "flinging" content from a user's device (typically a phone, tablet or laptop) to a larger external screen. Casting options like Google's Chromecast give consumers powerful, easy, inexpensive ways to get the OTT content they want to the large screens where they really want to watch it. Rather than reinventing the wheel, casting leverages the devices consumers already love to power expanded discovery and better control.
Early results are promising. At the Google I/O developer conference last week, the company announced it has sold 17 million units worldwide, with users hitting the cast button an impressive 1.5 billion times. Plus, the company revealed data that it believes demonstrates how the device has changed the way people watch TV. Google said that Chromecast users in the U.S. market are now consuming 66 percent more media content each day in comparison to mid-2013, when the device was launched.
Casting is such a superior solution for consumers that I believe it has the ability to solidify OTT as the new norm for household entertainment in the near future - if the major content and device brands would come together to fully endorse it as the industry standard.
Why aren’t they? Unfortunately many companies simply don't realize the significant advantages casting offers:
- Simple and cheap to build and maintain. While native apps must build an experience from the ground up, casting requires minimal coding. Instead of a large, complex native app on the OTT device, casting requires only a minimal "receiver" app on the device. Chromecast even has a default receiver that requires no additional coding at all.
- Easier consumer adoption and larger potential customer base. Casting significantly lowers the barrier of entry for consumers. At $35, Chromecast costs less than a brand new Smart TV while also being cheaper than connected boxes like Fire TV and Apple TV. But it's not just about price: casting gives consumers access to a much wider range of content.
- More ad inventory and maximum ad revenue. Perhaps the biggest advantage casting has over native apps is in advertising. By cutting out the middle-man (the platform holder), brands can get a bigger chunk of their advertising revenue and can offer larger ad inventory.
The benefits casting offers to brands' OTT strategy are massive. If we can get beyond the "apps everywhere" mindset that is misleading the industry, content creators can help to bring about the future of household entertainment...and get access to a bigger chunk of the revenue at the same time.
John Luther is SVP, Product Strategy for JW Player.