SES (EPA:SESG) said it now has 60 public and private broadcast users of its cloud-enabled media service since introducing it late last year.
The Europe-based satellite operator’s pronouncement comes as media organizations increasingly adopt technologies that would replace hardware with software, according to a recent analysis in tvtech. The benefits include scalability, virtualization and high-performance storage and computing capabilities.
These trends point to an option for satellite operators who have recently struggled with falling revenues in broadcast as consumers increasingly turn to streaming platforms.
Meanwhile, Reuters reported today that France-based satellite operator Eutelsat (EPA:ETL) is in acquisition talks with billionaire Patrick Drahi. He made an approach that would value the operator at $1.96 billion. A Eutelsat spokesperson declined to comment.
In June, Drahi acquired a 12.1% stake in telecom holding company BT Group (LSE:BT) worth $3.1 billion to be owned by Altice UK, a new entity controlled by Drahi-owned Next Alt.
International user base
SES has users in Europe, Asia and Africa for its Cloud Playout service, the company recently announced. Ethiopia is seeing momentum in adoption of the technology to include Ethiosat, the African nation’s first dedicated free TV platform. In December 2020, the Ethiopian government announced that all satellite TV channels should move to SES’ NSS-12 satellite so that Ethiosat could broadcast local and international news and entertainment.
The service enables TV broadcasters and channel operators the ability to prepare content in “minutes” since they do not need hardware, according to SES. Designed natively in the cloud, Cloud Playout offers flexibility while leveraging virtualized hardware with functions that include archiving, playlist, playback, encoding and graphics.
The demand for cloud-based media service has “exceeded our initial expectations,” Yvonne Bertalot, director of broadcasters segment market management for content delivery provider SES, told Connectivity Business. Timing underlines the success of the rollout, as it was completed during a pandemic.
“In fact, we are seeing an increasing number of customer inquiries and onboarding into the cloud each month,” she said. “So, from our perspective, it has definitely already taken off.”
Cost savings are a plus, said Bertalot, who declined to quantify them. The legacy model requires customers to invest capital for equipment on-site often with much more capacity than they need. With Cloud Playout, the cost savings come from flexibility and ability to scale with demand so that “customers are only paying for what they are actually using.”
In addition, the cloud-enable media option is available for users who are implementing a disaster recovery strategy.
The ecosystem for content delivery is changing with the capabilities of cloud services reaching media-specific offerings, tvtech found. Global connectivity coupled with the rapid exchange of content globally has strengthened capabilities, with the provisioning of services increasing at an almost “exponential rate,” it said.
SES is an end-to-end service provider for content delivery, Bertalot said. It helps aggregate content, generate a linear TV stream as part of a managed service, distribute content through satellite, fiber or internet portal, and provide OTT encoding and/or online video monetization.
The provider’s video segment saw a 3.2% decline in Q2 revenue to $308.7 million, compared with the same period a year ago. The sector represents about 60% of SES’ annual revenues.
Meanwhile, elsewhere in the media segment, a spokesperson for Intelsat (OTC:INTEQ) told Connectivity Business that there is no update regarding the status of its media business. In early August, the company disclosed that it would consider evaluating strategic initiatives to enhance the value of the business.
Intelsat’s media segment declined 9% in Q2 to $184.2 million in revenue, compared with the same quarter in 2020. Total revenues for the company, however, climbed 5% to $507.9 million. The media sector represents 36% of all revenue.
For its fiscal Q4 2021 in late July, the broadcast segment of Eutelsat dropped 6.6% to $211.2 million from the same period a year ago.