Pay TV Middleware is emerging from largely closed systems with long product cycles to more modular and open architectures with main operators investing more heavily in captive middleware while adopting a best-in-class approach. New technologies receiving investment include: advanced advertising; multiscreen guides; TV personalization via search, recommendation and discovery; and automatic content recognition. Application of analytics to video systems is rising in importance as well, with a focus on measuring quality of experience, driving consumer engagement, and improving monetization, customer acquisition, and ARPU.
Conditional Access Systems (CAS) and Digital Rights Management (DRM) technologies provide content protection (copy prevention) and revenue protection (blocking access to unauthorized users) for video content. The CAS market is changing slowly based on downloadable and renewable CAS technologies, as well as a significant transition to two-way content protection systems. The DRM market is maturing and moving from a PC and traditional telco IPTV focus to look at content delivery to connected TVs and multiscreen devices (tablets, smartphones). It is enabling a shift to periodic revenues rather than revenues driven by set-top box shipments. The addition of 4K/UHD content and specialized access and DRM criteria for that content is permeating throughout the space, and is causing providers to reconsider protection schemes early to be prepared for wider 4K content access.
Tier-1 vendors are consolidating and transitioning from product-oriented offerings to more holistic systems integration and service offerings. A second tier of vendors is focusing on more turnkey solutions. Innovation continues to happen through small, nimble start-ups on multiple continents, with search, recommendation and discovery, analytics, or interactivity at the core of their offerings.