To build or buy, is that really the question: Time savings
This blog was written by Hamish Muiry, Head of Sales.
Broadcasters (both legacy and cloud born OTT) spend a small, or actually quite large fortune, on sports rights. The technology that underpins the rights distribution to the consumer is critically important to customer churn, brand reputation, and potential monetary fines applicable if the broadcasts fail. It’s understandable that a broadcaster with engineering resources would take a decision to self-build. Trust plays a huge part in delivering the best quality streams to an audience at scale. Many broadcasters have typically chosen to build in-house. “If you want something done right, better do it yourself.” Perhaps. Once upon a time this would have made good sense. However this time, at the time of writing, we are experiencing one of the largest economic drops in the broadcast market, due to an economic crisis resulting in job cuts, a skills shortage in engineering talent, against a backdrop of innovation and technical progress that continues to accelerate. In this piece I attempt to argue that the risk is now with building such systems and the huge opportunity for broadcasters to offer their consumers a best in class service in-house. Three interrelated themes of focus for C-Level teams and Departments are cost reductions, speed to market, and managing business risk. Let’s take one at a time.
Leveraging cloud for profitability of live events.
Financial stakeholders are now more involved than ever in technical decision making. This is due to technology spending moving from traditional capex to an opex spend model and an ongoing economic crisis requiring decisions on historically low to medium size deals to be ratified all the way up to board level. Finance and procurement will be comparing amortization of a 5 year capex technical refresh with the competitive advantages and agility the opex alternative can offer. Purely in financial terms this makes a lot of sense, yet it’s not an apples with apples comparison. There is risk and opportunity costs to simply moving from hardware to hardware every refresh cycle. Whilst cloud opex models are overwhelmingly on the rise, many rights owners and broadcasters need to run hybrid diverse architectures managing a transition with one foot clamped with legacy tech debt, whilst new entrants to the market have the luxury of being ‘all-in’, running mission critical workloads in the cloud.
Global or pan-regional broadcasters have grown and spread organically. Their supply chains can typically be duplicated and diverse, adding complexity and cost to delivery workflows. The cloud offers a great opportunity to align geographically distributed teams into a set of common systems which can be run and managed from pretty much anywhere. Live supply chains in the cloud can be configured quickly, and turned on and off as required. They’ll typically start life as a Disaster Recovery pipeline or for second or third tier content. Quickly though, management teams see the benefits for spending and start moving key rights properties. We see a growing number of sports rights owners distribute via cloud IP (AWS Entitlement or open internet SRT). Therefore broadcaster acquisition of SRT is proliferating and keeping that live content in ‘lighter weight’ cloud pipelines makes good sense. Additional cloud-based frame rate conversions means that international content requiring standards conversion can be transformed in the cloud also, meaning that on-prem FRC can be reserved only for top tier content and frees up bandwidth.
Media companies are focused on the profitability of individual programmes and live sports events so understanding profit margins for fulfilling distribution against a given property is fundamental. Understanding infrastructure costs is an obvious requirement for tech owners with commercial responsibilities. Spend estimate calculators exist, line items in running costs can be nuanced, therefore it takes experience to be able to model costs accurately.
There is little doubt that the cloud offers excellent economic value for distribution of live event rights, it is still important that resources aren’t left on. Don’t let the bath overflow. This is where schedule-driven automation is so key to assist operators who may be handling multiple live events and carry responsibilities for 24/7 output. It helps them not to miss a beat.
SAAS and ‘all-you-can-eat’ options
SAAS companies that operate at scale may also be able to provide broadcasters and OTT Platforms beneficial rates for consuming AWS in their accounts. Discount percentages from a vendor may be on par with or surpass those afforded to a large multinational broadcaster. This is due to a larger committed spend with AWS accrued through running workloads for many XL customers. Further added benefits here can be less complex deployment in vendor owned accounts, increasing speed to market and improved fix times if issues occur.
SAAS offerings with low or no commitment are commonplace and effective for smaller volumes of content distribution. However enterprise license contracts will provide best value for larger output requirements when hourly license fees. Having ‘all you can eat’ licenses also means a distributor can react more quickly to adding new content to their portfolio when the opportunities arise. Further to the point above on SAAS infra spend, being able to commit will enable the best hourly rates for cloud spend.
The right tool for the job
Whilst optimizing infrastructure costs and software license spend is clearly important, it always strikes me that people’s time required to set up and manage live events isn’t given more detailed consideration. Managing the time spent between engineering and operational can play a larger part in management of costs, and carries opportunity cost when key resources are sucked in more commoditised workflows and therefore unable to. Either being able to do more with the same number of personnel or, ultimately, do the same with less. In the cloud broadcast world there are two camps of influence; engineering and operations, and how efficiently they interact is critical to a broadcaster’s profitability.
At M2A we see that the tooling that will be used by operations is typically vetted by the engineering teams first. It’s a fine line to draw, tools that make an operators’ life easy mean less dependence on engineers. Some engineers can interpret this as a threat to their position as less dependency disempowers them. However, many more take a more pragmatic view and see the value of tasks being offloaded to operations. Ops teams can then manage the scheduling and monitoring of live broadcast and VOD pipelines, meaning less call-outs and more time for engineers to focus on strategic technology projects.
Having highly valuable engineers pressing buttons in the AWS console is not a good use of resources. As an engineer’s time is more expensive to an organisation than an operators, democratisation of cloud tooling to enable less technical broadcast operators to manage cloud workflows is key to managing down the cost of delivering live events.
