The Impact of OTT Video Services on the Content Providers and the Existing Media Platforms in Taiwan

TitleThe Impact of OTT Video Services on the Content Providers and the Existing Media Platforms in Taiwan
Publication TypeConference Paper
Author(s)Liu, Y. - L.
Affiliation (1st Author)National Chengchi University Taiwan
Section or WGCommunication Policy and Technology
DateSat 29 June
Slot CodeCPTS1b
Slot Code (Keyword)CPTS1b
Time of Session9:00-10:30
RoomQ121
Session TitlePANEL:The Impact of the Emerging OTT Video Services on the Users, the Content Providers and the Existing Media Platforms in Asian Countries
Submission ID5792
Abstract

Panel Title: The Impact of the Emerging OTT Video Services on the Users, the Content Providers and the Existing Media Platforms in Asian Countries    The Impact of OTT Video Services on the Content Providers and the Existing Media Platforms in Taiwan   Yu-li Liu Professor, National Chengchi University Taiwan yuliliu@nccu.edu.tw   With the development of digital convergence, new media platforms have rapidly emerged.  The first was IPTV, followed by mobile TV.  The most recent one was the OTT video service which appeared in 2010 in Taiwan (Liu, 2012).  Next VOD, a subsidiary of Next Media, started to provide the OTT service via broadband.  It gave away the set-top-box free.  It also allowed its new subscribers to watch video services free for the first three months.  Due to the unstable broadband service, Next VOD did not fly as it wished.  It closed down its business in November 2012, because its parent company Next Media was acquired by other media conglomerates (UDN, 2012).  Although other OTT video services are not as big as Next VOD, they still have the potential to compete with the existing media platforms.   Unlike Korea, Taiwan’s OTT video services are not confronted with network neutrality issues.  In Korea, the ISPs are concerned about their bandwidth which is used by the OTT video service providers and their users without paying fees to the ISPs.  The ISPs want to discriminate against whoever uses the OTT Video service which is not affiliated with them by restricting the bandwidth usage cap in the bundling packages.  Therefore, the OTT video service providers have encouraged the regulators to adopt the “network neutrality” rule (Kim, 2012). It is not clear whether any ISP has boycotted the OTT service in Taiwan. The only controversial issue is that there is no content regulation for OTT TV. Furthermore, the content and shopping service providers on the OTT platform do not need to obtain licenses (Ho et al., 2012).  Therefore, fair competition is an issue.    In Taiwan, the existing media platforms have to pay attention to the development of the OTT video, because their ratings and revenues might decrease because of the newly-emerging media platform. Since cable TV penetration exceeds 80%, the content providers are afraid of being boycotted by the cable operators if they sell their content to other platforms such as IPTV or OTT (Liu et al., 2012).  Therefore, the OTT video services might have difficulty acquiring good content for their viewers.  In order to reach larger audiences, the content providers need to re-package their content so as to be suitable for different platforms and to avoid the implicit threat from the cable operators.   This paper employs Michael Porter’s Five Forces model to discuss the competition among the players in the related TV market.  It analyzes the impact of the OTT video services on the content providers and the existing media platforms. It also discusses the value chain, the business models and the success factors of the OTT video services.  The research methods employed include literature reviews and in-depth interviews.        Keywords: OTT Video, business model, content regulation, network neutrality

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