The increasing use and popularity of over-the-top (OTT) applications has been a continuous obstacle for wireless carriers. Although there seems to be no other option, carriers have long been hesitant to embrace OTT applications, largely because of the financial loss. However, consumers have fully embraced these applications and it’s time for carriers to get on board in order to remain relevant and generate revenue in the coming years.
Thanks to the recent Net neutrality decision and the pending evolution of 5G networking, carriers now, more than ever, have the resources available to finally figure out their relationship with OTT applications once and for all.
The past battles between carriers and OTT apps
In recent years, the use of mobile messaging apps has exponentially increased, which relies on carrier data or Wi-Fi to send a message — a key trait of an OTT application. A growing number of people are also “cutting the cord” and using their Internet service to stream their favorite shows on OTT applications, such as Netflix. This trend of consumers increasingly using OTT applications to access and share content isn’t surprising, because OTT applications provide a compelling user experience. However, carriers have long been more preoccupied with pushing back on OTT applications, while also fighting net neutrality: two obstacles that go hand in hand.
As net neutrality laws have now passed, carriers are finding themselves in a situation where they are being forced to finally change and adapt. Net neutrality in many ways pushes carriers to find ways to partner with OTT apps since they can no longer limit their connectivity. This powerful decision thus plays a huge a part in advancing OTT applications by acting as a catalyst for innovation and ensuring the breadth of options presented to consumers. Net neutrality will also now give carriers a better chance to compete with and embrace OTT applications, which is a huge win for consumers.
A recent example of this dissonance between carriers and OTT applications is Comcast’s relationship with Netflix. Comcast had repeatedly pushed back on Net neutrality and even tried to restrict their services to those organizations with a previously negotiated deal. Comcast’s resistance to Net neutrality was closely coupled with their resistance to OTT applications, as they refused to embrace third-party apps in any regard. However, based on consumer demand and continuous requests, Comcast recently announced that Netflix will be available on its X1 DVR service later this year. This will likely have a great impact in preventing Comcast customers from cutting the cord since they can tap into the OTT applications they love using their X1 set-top box.
Best practices and what the future holds
Carriers now have the proper resources to get a leg up on OTT applications, which should make it easier to embrace them. The evolution of 5G is something that providers will need to pay attention to and use to their advantage. Across the globe, 5G will allow more people access to connectivity. This will lead to even more advanced innovation in the realms of both IoT and OTT applications. To stay relevant, carriers need to look towards these capabilities and applications.
A great example is Verizon, who has successfully tapped into what consumers are looking for in regards to OTT. Verizon Messages is an OTT application delivered from operator to end user via the Google Play store, which features a 4.5-star rating – a high rating for an operator-based application. Why? It offers a feature rich and compelling experience that is extremely relevant to users and in line with consumer requirements.
Providers need to understand that OTT applications are here to stay and the time is now to embrace them. The only way to succeed in this space is to both deliver what the consumer is looking for, while also ensuring carriers are finding ways to meet their own top line objectives. This balance is the key to success in a market where OTT applications will continue to become even more prevalent.
The most important thing carriers need to keep in mind when it comes to dealing with OTT applications is that they should not fight it. They are popular for a reason: consumers like the availability and the functionality. Keeping this top of mind, carriers need to focus on getting over their personal struggle with OTT in order to stay relevant in the eyes of the consumer.