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Over-the-Top (OTT), in telecom parlance, refers to an app or service that delivers content such as streaming video and audio over the internet rather than traditional cable or satellite distribution. According to the 2017 OTT Video Services Study conducted by Level 3 Communications, viewership of OTT video services, including Netflix, Hulu and Amazon Prime, will overtake traditional broadcast TV within the next five years. Meanwhile, Juniper Research predicts that the global OTT market will increase to $18 billion in 2019, up from $8.5 billion just three years ago.
Additionally, it’s worthy of note that the audience for OTT content is growing not only in total viewership and revenue, but geographically. Last year, Netflix tripled its global reach by expanding into an additional 130 countries, as the video streaming service took its most aggressive step yet in its plans for international growth.
The reason for the surge in OTT viewership lies in immediate gratification: People want what they want when they want it. OTT allows viewers to consume content whenever and wherever they desire on their preferred device. Particularly for millennials, appointment TV is now widely considered a legacy entertainment model.
Supporting the increasing volume of streaming video requires solutions to the hosting, delivery, bandwidth and performance challenges that all too frequently frustrate the Quality-of-Service and experience of online video viewers. Whether at the source or along the last mile, insufficient bandwidth creates interruptions that result in dreaded buffering pauses. Content providers address bandwidth challenges by compressing data and bringing content closer to users by placing the data on edge servers in strategically located data centers and colocation facilities around the world. However, in order for OTT players to successfully reach their audience, it’s critical to collocate within data centers capable of providing low-latency connectivity to end users throughout their target geographic regions.
Colocation is an integral part of a successful OTT service strategy. A colocation facility assists OTT content providers to sidestep web congestion, ensure data security, and provide necessary infrastructure while reducing costs. Most importantly, it allows OTT providers to move content physically closer to viewers, thus reducing latency and increasing the quality of the viewing experience.