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Sharing is the new black

By October 12, 2016 No Comments

You think you’ve got the kids to bed (or at least to their rooms) and you sit down to watch the latest episode of Narcos on Netflix.  But you get the message that ‘eldest son / daughter is currently watching Netflix on their phone’. Likewise with Spotify – you go to listen to music and you get the message that the same kid is listening to music on their phone. Welcome of the world of single user account content in a household.

Netflix has been pushing their multi-room / multi-device option for some time now. At present, the standard rate in Ireland is €7.99 for a single screen. I can upgrade to 2 screens (plus HD) for €9.99 /month or 4 screen (plus Ultra HD) for €11.99. So I can have peace and harmony for only an extra €4 / month. Now Spotify are seeing that sharing is the way ahead. Current Spotify for one device costs €9.99 / month. Now I can have 6 people in the same household using Spotify for €14.99 / month.

A couple of weeks ago I attended an excellent event run by European Communications on the subject of OTTs, telcos and digital services. At this event in a very trendy London hotel (well trendy by my standards), European Communications editor, Marc Smith presented the findings of their Q3 2016 survey on OTT and digital content. A couple of results jumped out to me. Firstly, the survey asked about the importance of partnering with digital content providers. On a scale of 1 to 10, the weighted average of the survey respondents was 9.4. So, fairly important then. Next up, was the question about what is the main driver for operators providing content. 41% opted for ‘creating differentiation from competitors’ and 33% went for ‘generating new revenues’.

Content partnerships are increasing in importance for operators. The content companies like Netflix and Spotify want to own the content in a household via shared / multi-person, multi-device accounts. Mobile operators would like to have as many subscribers in a household as possible. Many operators, especially in North America, offer shared data plans where you buy a bucket of data and can share this between different devices and different people. You can see where this is going.

Why don’t operators offer shared content services as part of their shared plans? An operator can offer a data bundle to be shared among the family. They can combine that with add-ons of Spotify and Netflix services that can also be shared. The combined approach may be more attractive to families than offerings from competing operators that don’t offer such shared bundles.

It’s a 21st century dilemma where one of the kids is watching Netflix on their phone at the same time when Mum and Dad are hoping to chill out watching TV. It also has a solution. Netflix and Spotify are already addressing it. The opportunity is for the telcos to get on board as well and to offer an even more powerful combination of shared content services as part of shared plans. 

 

Learn more about Openet’s Shared Data plans here