The True Cost of Multi-DRM
Amidst all this excitement, it’s easy to forget that OTT is yet to fully reach its monetization potential. Be it subscription models, pay-per-view models or advertising monetization, very few services today (live sports being a noteworthy exception) are winning healthy profit streams from OTT.
As such, it is prudent to control costs of developing OTT player and server infrastructure – and specifically the DRM and content protection aspects of the puzzle. This has caused many video service operators, broadcasters and the OVPs serving them to create in-house engineering projects to securely deliver and render content.
As we took a look at the full depth of the stack and technology landscape here at Frost & Sullivan, and quantified the implications of necessary expansions and updates over time, it quickly became apparent that very few companies would actually have the scale and internal expertise to build, expand and maintain DRM infrastructure independently. We found that multi-DRM solutions offer better total cost of ownership arguments, similar in some sense to the value proposition of OVPs or managed service providers in outsourcing video workflows and services.
As we talked to a number of content companies and technology vendors over the course of the research, we asked how they planned to migrate to DASH and HTML5, and manage the transition away from Flash and Smooth Streaming. Often we heard of stopgap measures to continue to use legacy technologies. DRM protection is a new feature to many OTT operators and OVPs who have been able to rely on encrypted streaming in the past. As we asked them about how they would be building out the necessary multi-DRM architecture, we heard a range of responses from “DRM is mostly free” to “that’s a really hard question, isn’t it?”
We have talked about many of the technical considerations around DRM and multi-DRM, most recently at a session at StreamingMedia East . Our new white paper, Total Cost of Ownership: The Key Metric for DRM Strategy, dives into the many aspects of total cost of ownership. It provides a framework for expense-conscious content companies to make strategic build vs. buy decisions for their multi-DRM framework and develops recommended best practices based on industry observations.
We’re excited to share many of those findings along with real-world experiences from Verimatrix and Divitel on Wednesday, Sept. 28 at 7am PT/10am ET/4pm CET. Sign up to attend the webinar and get your questions ready.
Avni Rambhia is the Industry Principal, Digital Transformation at Frost & Sullivan and brings extensive domain expertise in digital media markets, management consulting and business analysis. You can view her Frost & Sullivan profile here, and her Frost & Sullivan blog here.