Why Are We Launching the Endavo Digital Network?
You may have noticed that we’ve been going through a transition recently. Late last year we made a strategic decision to become a multichannel network (MCN) for OTT distribution – the Endavo Digital Network. I thought it would be worthwhile to briefly explain what’s behind our new trajectory.
The dynamic, sometimes turbulent, OTT market has undoubtedly become a serious disruptive force in the media and entertainment industry. Whether you’re in the TV, movie or sports/news media market, the value chain has changed and continues to do so at warp speed, largely due to the Internet. We’ve been involved in this emerging Internet video market, in some capacity, going back to 2005, the year YouTube launched. In many ways, the OTT market has matured very fast and much of the supporting technologies have even begun to get commoditized. But the disruption in the video value chain has also opened new opportunities and challenges yet to be solved. Hence our need to adapt.
The democratization of production, distribution and consumption of digital media and entertainment has disrupted the traditional content value chains. Take a minute to check out these 2 infographics from Media Redef illustrating the old and new entertainment value chains (great article as well):
Why is this important? While disintermediation (my favorite word :-)) has theoretically made it easier for content to get produced, distributed and monetized, it’s also created plenty of new challenges and confusion for both content creators, as well as distributors. The old model may have been difficult (and super expensive) to execute but the path was simple to understand. Today, while many barriers to entry have been broken down, the market is actually more complex than ever – multiple distribution channels, platforms, networks, targeted audience segments, business models to consider, none of which are guaranteed paths to success.
The “YouTube” economy has become a significant force in the entertainment space, with Generation Y and Z driving a paradigm shift in when and where consumers watch video entertainment. Multichannel Networks emerged a few years ago, to help YouTube creators build brand, audience, revenue, even produce content. MCNs built significant market value in no time, resulting in a flurry of big M&A deals in 2014-15 (e.g., Fullscreen/AT&T, Maker/Disney). The other large social networks, including Facebook and Twitter, have also shifted their strategy toward video. Snapchat is the new kid on the block with an entirely different video model.
Over same time, the TV economy has finally been pulled into the web, due largely to the impact Netflix had on the TV market, followed by Hulu, HBO, Amazon, CBS, ESPN, then everyone else! Service providers have also jumped into the OTT pool to try to save their subscribers from cutting the cord.
So enough with the purposefully simplified OTT history lesson we all know. The punch line here is that we see a very large and growing market that exists between today’s “YouTube” economy and the traditional TV economy that has a good amount of new pain and opportunity. Content is being created everywhere, much of which is too premium for YouTube (Red might take issue with that) but also isn’t finding the answer in the traditional content value chain that is being disrupted right in front of them. GO to NATPE and you’ll see what I mean. At the same time, the traditional networks and distributors themselves are trying to figure out how to defend against and/or take advantage of the new value chain being created, with or without them. Go to NAB and you’ll see what I’ll mean (I’ll be there, by the way).
Therein lies what we believe to be a tremendous market opportunity beyond selling vid tech. We see a large and growing market of professional and pro-am content that lives in between the converging YouTube economy and traditional TV. We’ve been talking to many traditional production firms who are trying to figure out the new OTT economy. We also see many emerging content creators who are producing premium “digital first” content that needs distribution. We also see media companies – sports, news, even brands – who are openly challenged by the all new platforms, distribution channels, marketing strategies and business models.
So, the Endavo Digital Network was born, leveraging our market leading OTT video services platform, to help content creators “find their channel” and to help new OTT networks find, aggregate and distribute premium content emerging from this new “digital first” economy. We’re taking a page out of the YouTube MCN book to partner with content creators on multi-platform distribution, go-to-market, branding and monetization. We call it “MCN 4 OTT”.
Say Hello to Endavo Digital Network! #FINDYOURCHANNEL