Grey clouds gather over Apple as Netflix snubs imminent streaming service

Apple is on the verge of announcing something big, but its TV streaming ambitions have been undermined as Netflix dismisses any tie-up with the iLeader.

Speaking at a press event at the streaming giants HQ, CEO Reed Hastings said Netflix would not be partnering with Apple or allowing its content to be hosted on any streaming service it might announce. There are a lot of unknowns about the Apple announcement on March 25, but at least this has been cleared up.

Rumours suggest Apple is going to create a streaming platform which could potentially compete against Netflix, though this is only one facet of the increasingly fragmented content landscape. With Disney and AT&T’s WarnerMedia also set to weigh-in, consumer frustrations are unlikely to be relieved any time soon.

With content becoming increasingly fragmented, a platform which brings everything together could be the winning formula.

“Content aggregation is the holy grail,” said Paolo Pescatore of PP Foresight. “There is too much fragmentation in video/TV; no-one wants to sign up to different services and have numerous apps. It is a disastrous experience.

“Beyond having the right content, the user experience is key. This means getting the content people want in one place, with one bill, universal search and all that jazz. In reality, this is hard to achieve as typically half of a household wants sport and the other half want entertainment, movies and kids shows.

“Netflix has done a great job to date. However, more content and media owners will pull programming off its offering. This represents a significant opportunity for the likes of Apple who has scale and greater resources. There is a role for a small number of players in the future.”

One question which should get a lot of people thinking is what does an effective content aggregator platform look like?

  1. Single bill
  2. Single sign-in/authentication
  3. Integrated content library
  4. Universal search
  5. Consistent customer experience
  6. An excellent recommendation engine
  7. Buy-in from majority of content owners/creators

However, just because it is easy to set out the conditions for an excellent content aggregator platform, doesn’t mean it will a simple task to figure out. The final point, getting the buy-in from the content owner/creator ecosystem, is where anyone with such grand ambitions will find the biggest issue.

The best effort we have seen so far is Sky in the UK. Why? Because it has somehow managed to convince Netflix to let its content be hosted on the Sky discovery platform not its own.

Some might suggest a disproportionate amount of news in the content world is focused on Netflix, but there is good reason for that; Netflix is the best. Few can compete with the current depth and breath of content, the user experience, marketing clout and foresight of Reed Hastings and his team.

Without Netflix on an aggregator platform, there does seem to be a big hole. One of the issues is Netflix does not like handing across the experience associated with its assets to partners. It knows how to keep its subscribers happy so why would it allow a partner to potentially tarnish this reputation.

This is what has made the Sky partnership all the more impressive. Netflix has allowed its assets to be hosted alongside Sky’s on Sky’s discovery platform, marrying two of the best content libraries available to UK consumers in the same place. This is the sort of partnership which ticks all the criteria listed above.

Sky has made an excellent start on the aggregator model, but it needs to continue to add new partnerships, increasing the depth and breadth of its content library to ensure it continues to dominate the premium TV space. Amazon Prime should be a key target.

An interesting development over the next couple of months will be the impact of Disney’s streaming proposition. It will put a dent into Netflix, but how much remains to be seen. Disney does not have the depth or breadth of content Netflix is able to offer, the ‘originals’ and the newly generated local content around the world take it to another level, though Disney will be an excellent partner to have.

We do not want to decide on the Apple streaming proposition until we have had a chance to actually see it but losing Netflix as a potential partner is a significant dent. However, as long as gathers the buy-in from enough partners, creating a proposition which ticks all the criteria we have listed, there is hope for Apple is the services arena.

Is the VR market primed to pluck?

For all the promise of virtual reality (VR) the consumer appetite remains as somewhat of an unknown. Theoretically the technology could revolutionise the entertainment space, but we’re currently in a bit of a waiting game.

HTC is ready to gamble the consumer appetite, supporting ecosystem and product portfolio has evolved to such a position to provide the fuel for a subscription-based library of premium VR content.

“We have built a new model for VR that shines a light on the great library of VR content this industry has developed and gives users a reason to spend more time in headset than ever before,” said Rikard Steiber, President of Viveport.

“At the same time, we’re increasing developer reach and potential revenue as more developers can monetize a single Infinity user. We believe this model matches how consumers want to experience VR”

In pursuit of simplicity, Viveport is effectively a ‘Netflix for VR’. Customers can either pay $12.99 a month or $99 a year to access a VR content library with more than 600 titles already listed. As with other subscription models such as Netflix for content and Spotify for music, customers will have unlimited access to all content hosted on the platform.

However, you still have to answer the question as to whether the VR segment is ready to deliver the much-anticipated riches.

For the profits to be made, three criteria have to be satisfied. Firstly, is there an ecosystem which is creating enough volume of content, wide enough variety and immersive enough experiences. Secondly, is the hardware priced to allow the opportunity to generate mass market penetration. And finally, is there enough demand from the consumer.

With 600 titles already listed on the platform, this would suggest there is a large enough ecosystem in place to create the content. HTC is promising more titles, as well as some co-ordinated launches such as ‘Angry Birds VR: Isle of Pigs’. Secondly, the price of VR headsets has been coming down recently, and while it is still expensive, it is not prohibitively so. Consumers can spend thousands at the top end, but then again Google Daydream View can be purchased for £69. The breadth of products is now available to make this segment potentially viable.

The final criterion is the consumer appetite. This is incredibly difficult to gauge without launching a product, but as long as there are early adopters it is a good time to launch. Let’s not forget, Netflix was not an immediate success, it took time to develop the monstrous subscription base it has today, but it steadily attracted more and more thanks to it being first to market, while also offering an affordable (and very good) experience. Much of this was done through word of mouth.

Another lesson which HTC will have to learn is that enough is never enough. Netflix has maintained it position as the leader in the content world because it is constantly driving for more. Last year, the team spend almost $8 billion on content acquisition and creation, a number which will drastically increase this year. Not only is Netflix funding bigger-budget productions, but it is also expanding the local content libraries around the world. With Viveport, HTC could do the same, but it needs to ensure it is constantly expanding.

HTC has crafted itself a leadership position in the VR world, and the raw materials are currently in place to make this a profitable segment. Add improved connectivity with fibre penetration increasing and 4G constantly improving to the above three criteria, and HTC could be onto a winner.

Who knows, maybe in a few years’ time we’ll be referencing Viveport as the heavyweight of the entertainment space, not Netflix.

Spotify accuses Apple of discriminating against it in the App Store

Music streaming service Spotify has declared war on Apple over alleged discriminatory treatment of its app and commercial terms.

In a blog post CEO Daniel Ek announced Spotify has filed a complaint against Apple with the European Commission. He claims “Apple has introduced rules to the App Store that purposely limit choice and stifle innovation at the expense of the user experience – essentially acting as both a player and referee to deliberately disadvantage other app developers.”

The main issue seems to be the commercial terms Apple offers Spotify, specifically taking a cut of the fees people pay for its premium services. While this is Apple’s prerogative, that behaviour is complicated by the fact that Apple operates its own competing streaming service, Apple Music, and allegedly punishes Spotify if it attempts to use an alternative payment system.

“We aren’t seeking special treatment,” wrote Ek. “We simply want the same treatment as numerous other apps on the App Store, like Uber or Deliveroo, who aren’t subject to the Apple tax and therefore don’t have the same restrictions. What we are asking for is the following:

  • First, apps should be able to compete fairly on the merits, and not based on who owns the App Store. We should all be subject to the same fair set of rules and restrictions—including Apple Music.
  • Second, consumers should have a real choice of payment systems, and not be “locked in” or forced to use systems with discriminatory tariffs such as Apple’s.
  • Finally, app stores should not be allowed to control the communications between services and users, including placing unfair restrictions on marketing and promotions that benefit consumers.”

Spotify’s timing is pretty good, since regulatory and political sentiment is quite hostile to US tech giants at the moment and Apple is expected to launch a TV streaming service later this month. Spotify has created an emotively-named website – timetoplayfair.com – to further detail its case. Apple will presumably insist rules are rules, but the case against it seems reasonably strong it’s quite possible it y eventually back down on this one.

 

EE takes step towards content aggregator model

Content is a tricky topic to discuss around EE and BT, such is the scale of the disaster over the last few years, but a tie up with Amazon Prime and MTV Play is a step in the right direction.

The new content offer will see EE customers receive six-month memberships to both Amazon’s Prime Video service and MTV Play. The news starts to make a more comprehensive content platform for the MNO, with customers already able to access Apple Music and BT Sport, all of which is covered under the EE Video Data Pass, a zero-rating initiative available to all customers.

“It’s our ambition to offer our customers unrivalled choice, with the best content, smartest devices, and the latest technology through working with the world’s best content providers,” said Marc Allera, CEO of BT’s Consumer division.

“In offering all EE pay monthly mobile customers Prime Video and MTV Play access, in addition to BT Sport and Apple Music – we’re providing them with a wealth of great entertainment they can experience in more places thanks to our superfast 4G network, and soon to be launched 5G service. So, if they want music on a Monday, telly on a Tuesday, films on a Friday or sport on a Saturday, we’ve got something for them.”

While the content play over the last couple of years have been pretty dismal this is an approach to content and diversification which we like. It allows the telco to leverage the scale of their customer bases, while also adding value to the existing relationship with said customers.

Content fragmentation is an irk for many customers, not only because of the various apps which need to be installed, but also the number of different bills. EE doesn’t seem to be addressing the first issue but consolidating bills to a single provider might well be of interest to some customers. It also has the advantage of making EE a ‘stickier’ provider, perhaps having a positive impact on churn.

“Content is a key differentiator for telcos,” said Paolo Pescatore of PP Foresight. “However, consumers are now spoilt for choice resulting in too much fragmentation. Telcos are very well placed to aggregate content, integrate billing and provide universal search. Whoever achieves this first will have a significant advantage over their rivals.”

Sky is one of the companies which has had a good crack at addressing the fragmentation challenge, Sky and Netflix content is available on the same platform and through the same universal search function, though EE’s push on the mobile side would certainly attract attention. Consumers no-longer consider entertainment as simply for the living room, new trends show more preference for on-the-go content.

While this is a step in the right direction for EE, this is only one step. The content options need to offer more depth to meet the demands of the user, while streamlining all the content into a single app would be a strong step forward. It would certainly be difficult to convince partners to hand over customer experience to a third-party, Netflix has shown much resistance to this idea making the Sky tie-up all the more impressive, though whoever nails this aspect of the aggregator model would certainly leap to the front.

How carriers can grab a piece of the billion-dollar mobile-gaming pie

Telecoms.com periodically invites third parties to share their views on the industry’s most pressing issues. In this piece John-Paul Burke, Country Manager UK, Ireland and the Nordics for Gameloft, has some tips for how operators can grab a bigger piece of the mobile gaming action.

You only have to look around your train or bus home from work to see how many of your fellow commuters are playing a game on their smartphone, to know that mobile gaming is absolutely huge.

The global mobile games market was estimated at $63.2 billion in November 2018 (according to Newzoo’s 2018 Global Games Market Report). It’s clear that what was once a niche hobby reserved for hardcore gamers is now mass market. Every smartphone is a console, meaning that everyone, everywhere, can be a gamer. Even within the gaming industry, mobile gaming makes up 42% of worldwide revenue.

This has let companies across a number of sectors diversify their revenue streams, providing the scope for them to reach existing (and prospective) customers through mobile gaming. Yet arguably, carriers have been slow to embrace the opportunity, and have largely overlooked gaming as part of a broader package of benefits.

As competition for customers looks set to intensify even further within the mobile industry, here are three ways carriers could use gaming to differentiate their offering.

All-you-can-eat gaming

The mobile sector has long understood that it can leverage people’s love for entertainment streaming services, to incentivise prospective and existing customers. EE was the first to clock on, announcing a six-month free subscription to Apple Music for its users in 2017. Vodafone soon followed, and now offers a huge range of video and music streaming services to customers across its Red Entertainment plans.

Not dissimilar to services such as Netflix or Spotify, “all-you-can-eat” gaming packages allow customers access to a range of games – either on a complimentary basis, or for a fixed monthly fee billed directly through the carrier. Customers could benefit from, for example, unlimited downloads and play time, with no in-game ads, while carriers can benefit from a proportion of the income, and increased customer loyalty.

These packages are already offered by carriers in the Americas and Europe. Gameloft’s own unlimited gaming platform is used by America Movil, Telefonica LATAM and Tim Italy. However, they are yet to become common in the UK. This is soon set to change. Verizon announced earlier this year that it would be joining big tech companies like Amazon and Microsoft in developing its own games streaming service. We can expect to see increased interest and demand from UK customers in all-you-can-eat gaming – with opportunities for UK carriers to offer this kind of package.

Surprise and delight

Another route carriers could take to engage existing customers is to surprise and delight them in the games they’re already playing.

Services such as O2’s priority scheme demonstrate the power of reaching customers where they already are. For instance, allowing participants to buy tickets for their favourite artist or event up to 48 hours before the tickets are released to anyone else. Offering a huge range of deals and discounts in the stores and restaurants customers visit every day. These are small incentives but help people to experience the things that matter to them. They punch above their weight in terms of the value they add.

A number of publishers work with carriers to offer their customers free in-app credits or power-ups in their most-played, blockbuster games. This is an effective tool to build loyalty, surprising customers with the means to progress in the game they’re playing is a quick win that carries value for the users.

Infrastructure to support mobile gamers

Emerging technologies, which can help boost network performance, will allow carriers to offer packages that fundamentally improve the quality of their customers’ gaming experience. After all, for gamers, network performance is of utmost importance, especially when gaming gets competitive. Good bandwidth, low (or no) latency and packet loss all help ensure that their game runs smoothly, and that they’re on a strong footing when playing against others.

With 5G set to launch this year, there’s a huge opportunity for carriers. Mobile gamers will arguably be the greatest beneficiaries of 5G, which can help make increasingly detailed and bandwidth-heavy mobile games smooth and lag-free. Similarly, Edge computing, which enables data to be processed closer to the user, could also help reduce delays.

Some telecoms companies are already offering packages tailored to the gaming industry’s huge market – such as Virgin Media’s VIVID 350 fibre broadband, promising an ultrafast connection fit for the needs of PC and console gamers. It’s only a matter of time before mobile carriers begin investing in their infrastructure in order to offer similar packages to mobile gamers.

Ofcom’s decision late last year to reform the switching of mobile communication services means it will be easier than ever for consumers to take advantage of competition, and to move to a better deal with a different provider. Yet Ofcom’s decision also presents an opportunity for carriers. There’ll be greater scope than ever to catch the roving eyes of potential new customers. Either way, telcos need to ensure they’re offering customers everything they can – and part of this should be making it their mission to help people more easily play the games they love. Or, they risk missing out on their slice of the $63.2bn mobile gaming pie.

AT&T mucks about with WarnerMedia some more

AT&T has finally got the US government off its back, but now the challenge of making a success of its mega-acquisition really begins.

Last week an appeal from the US Department of Justice to reverse the acquisition of Time Warner by AT&T, which completed in the middle of last year, was rejected and the DoJ decided not to appeal, so that seems to be the last of the US governmental opposition to it. Now we get to the small matter of absorbing a massive media company into an even bigger telecoms one and making a success of it.

Respecter of tradition as AT&T clearly is, the first step is a good old reorg. There’s nothing like hiring some fellow members of the CEOs golf club and drafting up a shiny new organogram to make you feel like you’re really getting somewhere and in that respect AT&T seems to have scored a hole in one.

The flagship appointment could also be viewed as a replacement since Richard Plepler, long time boss of arguably the most valuable component of the acquisition – HBO – decided to call it a day last week. It has been widely reported that this was the result of the kind of culture clash and competing visions that are typical of M&A, but it still feels like a major negative to lose someone with such rare experience of making and monetising premium content.

In retrospect the writing had been on the wall for a while. Last summer the AT&T lifer put in charge of WarnerMedia, indicated that he wanted to refocus on quantity of content, which usually means a reduced emphasis on quality. That’s not what HBO is about and all the talk in the world about big data and advertising won’t change that. HBO is a premium subscription model and AT&T would be unwise to think it knows better.

The person charged with reinventing the wheel is Robert Greenblatt, who was previously Chairman of NBC Entertainment. He will head up the entertainment and direct-to-consumer silos. Meanwhile Jeff Zucker is in charge of news and sports, which includes CNN, Kevin Tsujihara is in charge of kids content and Gerhard Zeiler is Chief Revenue Officer for WarnerMedia.

“We have done an amazing job establishing our brands as leaders in the hearts and minds of consumers,” said Stankey. “Adding Bob Greenblatt to the WarnerMedia family and expanding the leadership scope and responsibilities of Jeff, Kevin and Gerhard – who collectively have more than 80 years of global media experience and success – gives us the right management team to strategically position our leading portfolio of brands, world-class talent and rich library of intellectual property for future growth.”

“I’m honoured to be joining WarnerMedia during such an exciting time for the company and the industry as a whole, and I look forward to working alongside the many talented executives and team members across the company,” said Greenblatt, as convention demands. “WarnerMedia is home to some of the world’s most innovative, creative and successful brands and we’re in a unique position to foster even deeper connections with consumers. And it goes without saying I will always have a soft spot in my heart for HBO going back to the rewarding experience I had producing Alan Ball’s Six Feet Under.”

See? He’s all over this HBO shizzle. Thanks for everything Plepler, but I got this. To be fair Greenblatt he does seem to have pretty solid experience and is presumably a safe pair of hands, but if Stankey tells him to sacrifice quality for margin and the mass market he will presumably oblige. Telecoms is a very quantitative game and there is a real danger that AT&T will be culturally incapable of appreciating things that are harder to measure and for which the ROI is less immediate and demonstrable. If that turns out to be the case at least the former Time Warner people will be able to draw on their rich experience of failed M&A to help them.

Trump opposition to AT&T/Time Warner deal was personal revenge – report

Few would consider Donald Trump a conventional President but attempting to block AT&T’s acquisition of Time Warner to get revenge for poor coverage would be another level.

Trump’s distaste for CNN is widely known, though The New Yorker is now claiming the President’s opposition to AT&T’s acquisition of Time Warner was little more than a personal vendetta against the newsroom for poor coverage as opposed to an ideological protest against market consolidation. We’re not too sure whether to be surprised by such an accusation, such is the dramatic impact to the status quo Trump has had on politics.

It is claimed President Trump was attempting to pressure the Department of Justice into blocking the monstrous acquisition as revenge for the negative news coverage on Time Warner-owned CNN. According to The New Yorker, in a meeting with Trump’s former lawyer Michael Cohen and former Chief of Staff John Kelly, the President said:

“I’ve been telling Cohn to get this lawsuit filed and nothing’s happened. I’ve mentioned it fifty times. And nothing’s happened. I want to make sure it’s filed. I want that deal blocked.” Gary Cohn was, at the time, the Director of the National Economic Council – the main Presidential policy-making forum for economic matters.

The New Yorker then goes onto to claim Cohn resisted the push from the President, with aides suggesting he did not understand the ‘nuances’ of antitrust and competition law.  The Department of Justice did eventually file its complaints, though these were eventually overturned by a Federal Judge, with the DoJ then turning to the court of appeals.

It’s worth noting is that The New Yorker is not a friend of President Trump. Owned by Conde Nast, the editors are apparently given complete freedom from the parent company, with the publication having endorsed Barack Obama in 2012 and Hillary Clinton in the 2016 Presidential Election. The main topic of the New Yorker piece was an investigation into the relationship between right-leaning Fox News and President Trump.

While there certainly is a left-sided slant, it is also a highly respected title which has never failed a fact check according to the Media Bias/Fact Check website. This should not be considered as unusual as there are very few (if any) mainstream media titles in the US (or worldwide for that matter) which can honestly state they are impartial; there is always some sort of political bias.

What this does indicate is the growing, and not always positive, influence of politics of the TMT segments. Although politicians might have been slow off the mark in regard to the digital euphoria, they are certainly catching up quickly. Mass market communication has dramatically shifted away from traditional media in recent years, and the politicians are following the wake.

For AT&T, this is a headache which it will be happy to put in the past. Last week, a US Court of Appeals for the DC Circuit rejected an appeal from the Department of Justice challenging the Federal Judge which overturned its complaint against the acquisition. The DoJ claimed AT&T would have “both the incentive and the ability to raise its rivals’ costs and stifle growth of innovative, next-generation entrants”, though the Federal Judge and the appeals court dismissed the antitrust claims.

The number of lawsuits, counter-lawsuits and appeals has now created an incredibly complicated timeline, but there does not seem to be many routes of resistance left. Sooner or later, AT&T will be able to start figuring out how to recoup the $107 billion it decided to spend on Game of Thrones.

Apple expected to launch half-baked streaming platform

Rumours are swirling around the Apple content business once again, this time pinning an April launch date on a streaming product which would offer third-party bundles in-app.

The aggregator platform for content is one which is becoming increasingly popular as the industry starts to realise how difficult it is to be a content creator. Apple has tried over the years, with only a sprinkling of success, but it seems it is hedging this new position by bundling other premium subscription services into the same content platform.

According to CNBC, Apple will create a video content platform to host its own content, which will be free to those who own Apple devices and offer the option for users to tie in premium subscriptions from third-parties. This sounds like an excellent idea, the fragmentation of content across different platforms is a frustration for users, though the absence of some might be a significant stumbling block.

As it stands, Apple has been unable to negotiate a relationship with HBO, though this is still a possibility, while the report also claims Hulu and Netflix will not be on the platform. For such an idea, and it is a good one which will appeal to consumers, all the various options need to be available. As it stands, with some of the most popular streaming services absent the appeal of the platform is severely dented.

“Any move is long overdue and comes at a challenging time for any new player,” said independent analyst Paolo Pescatore. “We’ve seen an explosion in OTT SVOD services.

“For the service to be successful it will need stand heads and shoulders over rivals, great content, great UX, a one stop shop destination. Unfortunately the market is hugely fragmented and consumers do not want to sign up to numerous services. There is an opportunity to unite all of these services. Whoever gets this right will be in pole position. If Apple has serious aspirations to compete in this landscape it needs to make a significant acquisition.”

But what could be the issue? Rumours are pointing towards the terms and conditions set forward by Apple; they might be asking for too much.

Looking at the App Store, Apple has traditionally asked for a 30% slice of any subscriptions bought through the platform, a number which decreases to 15% in the second year. It also demands 30% of in-app purchases, leading some developers to take users off-app to complete any transactions, creating a loophole in the terms and conditions. It seems these terms ate being extended to the aggregator platform and might be the reason Apple is finding difficulty in negotiating with partners.

Anonymous sources quoted by CNBC are suggesting HBO is resisting so far as Amazon Prime offered better terms than Apple. Sticking to its guns might sound like an attractive move to the management team and investors, but unless Apple gets a decent level of premium content on the platform to supplement its own mediocre library the platform will not be a success.

“Apple’s strength has always been seamless integration between hardware, software, services and now, presumably, content,” said Ed Barton, Chief Analyst at Ovum. “It has a lot of strengths to leverage in launching a video service. It’s problem is launching a video service in 2019 is about as hard as it has ever been, the competition is insanely strong and very well established in audience viewing habits.

“More well funded competitors are launching this year and making enough shows to attract and retain audiences is getting harder and more expensive. I don’t doubt Apple can launch a great video service, whether apple can sustain a great video service over the longer term in the brutally competitive environment for premium video is the question.”

Another strand of the software and services push will take Apple into the world of magazine subscriptions. Similar to the plans above, premium magazine subscriptions will be offered to users through the iOS news app, though considering the strife traditional content providers are in, Apple might be able to throw its weight around a bit more.

This is perhaps the problem Apple is facing; it thinks it is more powerful and influential than it actually is. Of course, Apple is one of the most respected and dominant brands on the planet when it comes to consumer hardware, though the software world is a completely different dynamic. It cannot bully companies like Hulu, Netflix and HBO into its own terms and conditions, as these are companies which are successful in the content world in their own right. Apple is trying to break into a new space, not necessarily the other way around.

That said, Apple does have a very strong relationship with its hordes of loyal customers. It can add value to any business it partners with, but perhaps it needs to realise it is only one hand amongst hundreds which is trying to lure customers onto its platform. What is clear right now, is that without enough headline grabbing content on the platform, the idea will certainly fall flat.

EA’s Fortnite copycat is off to a flier

One week after Electronic Arts launched Apex Legends, a free-to-play online battle royale game, the team is purring over 25 million sign ups and over 2 million concurrent players at peak times.

The game itself, developed by Respawn Entertainment and published by EA, is nothing that original. While the look of the game might have a different feel to Fortnite, the idea and gameplay is effectively the same and users are seemingly loving it. Just a point of comparison, it took Fortnite three months to hit the 25 million sign-up milestone.

“What a week,” said Vince Zampella of Respawn Entertainment. “Since we launched Apex Legends last week on Monday we’ve seen the creation of an Apex Legends community that is excited, thriving, and full of great feedback and ideas. Our goal is to build this game with you, our community, so keep giving us your feedback because we really are listening.”

Gaming might well be a niche in the telecommunications world right now, but it is growing at a staggering rate. It won’t be too long before the telcos have to pay attention to this segment of the digital world, factoring in gaming as a major conversation in the connectivity mix.

What Fortnite has done over the last couple of months is take a niche segment of the gaming world out to the masses. Online multiplayer formats are of course not new, but the free-to-play idea, with revenues being sourced entirely through in-game purchases, has been taken to a new level. The accessibility of a relatively limited experience has captured the imagination and interest of new users, opening the door for other developers to follow.

Of course, as the popularity of these games increase, the demands on the network will do as well. These are games which are reliant on real-time experiences, marrying interactions between users all over the world. For avid gamers, or those with children, purchasing decisions might well be impacted on the performance of these experiences. Now it might not seem like a massive deal, but these trends have a tendency to snowball; just look at the explosion of video content over the last couple of years.

It’s just another factor for the telcos to consider over the coming years. Gone are the days where gamers are satisfied with a linear, story-mode experience, something which would have been easy for the telcos to deal with. These games require downloads and updates, but this is nothing compared to the demand of real-time interactions with 20+ other users in countries all over the world.

Gaming has largely been ignored to date, but with the segment creeping out of its niche corner offering new and in-depth experiences for the mass market, it is increasingly becoming a burden on the network.

T-Mobile US ditches streaming for aggregator TV play

After T-Mobile acquired Layer123 back in 2017, the US has been holding its breath for another Uncarrier move to disrupt the content world, but its not going to be as glitzy as some would have hoped.

Speaking on the latest earnings call, the management team indicated there will be a foray into the content world, but it appears to be leaning more onto the idea of aggregation than creation and ownership.

“It’s subscription palooza out there,” said COO Mike Sievert. “Every single media brand is, either has or is developing an OTT solution and most of these companies don’t have a way to bring these products to market. They’re learning about that. They don’t have distributed networks like us. They don’t have access to the phones like we have.

“And we think we can play a role for our customers as I’ve been saying in the past at bringing these worlds of media and the rest of your digital and social and mobile life together. Helping you choose the subscriptions that makes sense, building for those things, search and discovery of content. We think there’s a big role for our brand to play in helping you.”

The T-Mobile US management team might be antagonistic, aggressive and disruptive, but ultimately you have to remember they are very talented and resourceful businessmen. A content aggregation play leans on the strengths of a telco, allowing the business to add value to a booming industry instead of disrupting themselves culturally trying to steal business.

Content streaming platforms have been an immense successful not only because of our desire to consume content in a completely different way, but also due to the companies who are leading the disruption. The likes of Netflix, Hulu and Amazon are agile, creative and risk-welcoming organizations. Such a disruption worked because the culture of these businesses enabled it. Telcos are not part of the same breed.

However, this is not a bad thing. The basic telco business model is connecting one party to another and this can be of benefit to the content segment. Telcos own an incredibly valuable relationship with the consumer as most people have an exclusive relationship with a communications provider (not considering the broadband/mobile split) and a single device for personal use. The telcos own the channel to the consumer.

Sitting on top of the content world, providing a single window and, potentially, innovative billing services and products could be immensely valuable to the OTTs, as well as securing diversification for the spreadsheets internally. The content aggregation model is one which is functional and operational, perfectly suited to the methodical and risk-adverse telcos.

Specifics of this Uncarrier move are still yet to emerge, but the T-Mobile US management team are promising to do something with the Layer123 acquisition sooner rather than later. It might not just look like what most had imagined initially.