NEW YORK – Internet video and over-the-top (OTT) video platforms have boosted global video production, especially in English-speaking countries like Canada, says a new report by The Boston Consulting Group (BCG).
The report, The Impact of OTT on Video Production Around the World, looks at the impact of OTT on domestic video production markets, highlighting important takeaways as business leaders and policymakers reconsider long-standing domestic content production quotas and robust tax subsidies in an increasingly competitive multiplatform video market.
In addition to offering consumers alternatives to traditional pay TV and broadcast as well as new ways to watch (out of home, binge viewing), OTT has also driven a surge in the volume of high-quality production. Canada has increased growth in OTT content spending by 6% from 2011-2015, says the report.
"Since English content travels comparatively easily across borders, Canada and the U.K. are benefitting from the trend of content globalization that OTT has enhanced, reads the report. “In fact, foreign distribution has been a key level of growth in Canada and the U.K, enabling domestic creators to further monetize their libraries by selling content abroad in first- and second-run windows."
The report adds that OTT is driving growth in such categories as serialized dramas and children’s content, content suitable for time-shifted and binge watching, and content that is cross-cultural or travels well across markets.
The impact of OTT on local jobs and culture is mixed, as jobs are not growing at the same rate as production dollars in professional content, continues the report. There is some risk to local producers as professional content, backed by big money, focuses on huge hits with global appeal. At the same time, semi-professional and amateur content creation, much of which is hyper-local in focus, has become a significant factor in the cultural landscape.
“The long-term impact of OTT is an evolving story,” said Martin Kon, a BCG partner, and a co-author of the report. “Content expenditures are strong and production revenue is increasing, driven by increasing investment in both traditional and amateur content creation. But the impact on jobs and culture is not as clear. Policy makers can no longer regulate supply in today's unconstrained environment as they have in the past, as consumers access unlimited on-demand catalogues. Rather, they need to look at the demand side of the equation in order to determine the appropriate long-term support for local production and storytelling.”
