George Kilpatrick

Masstech CEO George Kilpatrick looks back on a year that nobody expected, but takes heart from the lessons we’ve learned, and how they will shape the year to come.

In the summer, I wrote about the impact of COVID-19 on Masstech and the industry, and at that time we somehow believed that we were through the worst and would see a slow recovery as summer passed. How wrong we were! Today in the US, having got through their election surprisingly efficiently (though not without drama for other reasons), there now seems to be in a post-Thanksgiving holiday increase in positive cases and deepening economic woe. The UK and Western Europe are split into multiple tiers of increasing restrictions, including now Germany. And even countries who were held out as paragons of good virus management such as Singapore and South Korea, are now entering a new wave of infection. 

The media industry is calling for new business models

It’s not surprising that media industry analysts and commentators are issuing urgent calls for new business models given the 10% reduction in the media technology market. They have warned of the need to adapt and now we are seeing real changes happening. Two specific examples are:

Cinema – Warner Brothers have upset AMC, the world’s largest cinema operator by announcing that from now on all movies will be released on HBO Max on the same day as the cinema release. Given the pandemic restrictions this is not surprising but is a hammer blow for theatres

Sports – The impact on sports broadcasters has been just as savage. Ticketing and advertising have been hit and some broadcasters are struggling to maintain their rights payments and breaking contract.  It’s estimated that COVID-19 has cost global soccer an estimated $14.4 Billion and ESPN viewership is down 45% according to analysts at Devoncroft [1]. Broadcasters are reacting to the 25-40% reductions in advertising spend by cutting staff and rationalising operations and seriously considering aggregation.

The pandemic has forced all organisations to adapt and change their business models

Content delivery solutions are more relevant than ever

So how are suppliers to the media industry adapting? You would imagine given the situation that we’re seeing an inevitable decline in demand as cash control has been paramount. But actually, after some inevitable delays to sales decisions, providing the engineering groundwork has been done, companies like Masstech whose video storage management solutions help to deliver content to consumers are more in demand. Continuing to invest in cloud functionality and customer features has made us more relevant than ever. 

Take Kumulate Gateway, for example.  Broadcasters are having to cast their content nets far wider as live content dried up and studios reduced production output. Finding great foreign language content is easy. Using it is not. It requires ingest, standards conversion, transcoding and format normalisation, metadata enhancement and compliance editing. Automating this for an environment which cannot support large collocated operations and compliance teams is key.

As is the need to manage their existing inventory. Utilising archive video assets for long tail OTT channels is not only necessary but profitable. With over 60,000 linear channels globally and an additional 12,000 OTT streaming channels[2] (not including User Generated Content on the likes of YouTube) there are a lot of schedules and catalogues to fill. Efficient search and content management workflows become more important as do tools such as Kumulate Gallery in helping customers advertise their catalogues for distribution.

Daring to set predictions for 2021

So where do we see 2021 going? COVID has made forecasting even more inexact so it is with some trepidation that I dare to predict anything. What is clear is mass vaccination should allow the world to return to normal operations. With an end to the pandemic, I suspect we will see increased investment in those projects that were set in motion out of pandemic-fuelled necessity. Enforced responses to COVID opened eyes as to what is possible and those lessons will not be forgotten, 2020 has not been a lost year after all.

In video content management we believe the following:

As we look ahead to a new year with some trepidation (surely nothing can be as unpredictable as the last!), at Masstech we will focus on lessons learned, challenging ourselves to keep innovation front and centre, and supporting our customers to get more from their video assets. 

[1] CNBC Interview, Devoncroft Partners LLC Nov 2020

[2] Global OTT Services by Market IHS Nov 2019;  and TV Channels by Market  2016-2019 HIS Nov 2019

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