• by Alex Weprin , April 9, 2018

Should free, over-the-air broadcasters go all in on streaming video? That's a question being pondered by The BBC in the U.K., and the organization’s movement in the OTT space could have ramifications in the U.S.

The BBC recently released its 2018-2019 annual report, which presents a state of the firm, as well as its strategic goals in the coming year.

Technological change was at the heart of the document.

While many consumers in the U.S. and U.K. still watch TV live and over-the-air (or at least through a pay-TV provider), the future is streaming.

“Our challenge in this period is to make sure that we are serving those for whom the internet is their primary medium, while making sure that those who want to watch and listen to traditional channels continue to be served, too. We must be ready for an internet-only world whenever it comes -- and it is coming soon -- but we must try to serve all our audiences brilliantly in the transition,” the report says.

“Young adults watch less television than older people, and listen to much less radio. In just a few years online-only video has grown from 5% of young people’s consumption to 25%. Music streaming has gone from around 10% to around 30% of listening. We know that where children are leading the way, and where young audiences are now, older audiences will likely follow.”

Content is increasingly becoming a global game. Netflix is now available in nearly 200 countries and territories, while U.S. networks like CBS and HBO are planning to expand the global footprint of their streaming services.

"There is great opportunity for broadcasters, especially premium broadcasters with strong brand recognition, to evolve and meet the needs of streaming audiences,” Mark Zagorski, CEO of the online video advertising platform Telaria, tells Digital News Daily. “We know that the definition of watching television is evolving to include long-form content on any device, and it’s important for broadcasters to develop their programming strategy with that future in mind.”

While the BBC relies on government funds, U.S. broadcasters can lean into their advertising sales expertise to drive growth. While Netflix remains the 800-lb gorilla of streaming video, the rise of OTT video bundles, paired with services like Netflix, Hulu and HBO Now, means that there is an opportunity to break in with a free, ad-supported option.

Zagorski adds: “We’re also at the start of the move to advertiser-supported video versus the many subscription services that are out there. This is a huge opportunity for broadcasters because consumers simply are not going to be able to bear the cost of so many subscription services. Content providers will need to be nimble and savvy and learn from the mistakes of linear TV to effectively compete with digital-first media companies.”