Outsourcing: Is it for your operation?

The value for broadcasters

Outsourcing playout services management offers increased flexibility to cope with new technologies. Broadcast engineers are experts in linear technology, yet with multiscreen services relying on fixed or mobile internet, there is the potential for competency gaps to appear. Integration with an external team that is experienced in working with IP-based technology means that engineers become part of a dynamic, forward-looking environment.

The business model for working with an external broadcast services team is three-fold:

• It helps broadcasters to reduce OPEX and CAPEX by assuming responsibility for personnel and technical platforms.
• Through consultative sales, broadcasters can be guided toward new services, revenue streams and technical solutions.
• Broadcasters can focus on their core business — understanding the viewers, acquiring and packaging content, and selling advertising (in the case of a commercial broadcaster).

Reductions in OPEX and CAPEX can be achieved with an external partner by leveraging economies of scale. An external company will ideally work with a number of different partners, so there is the opportunity to share investments in new technology, meaning that the same resources — in terms of new equipment and team experience and knowledge — are available to everyone.

Additionally, when new technologies and trends become such a core part of the television landscape, as we are seeing now with the rise of multiscreen and a move to more HD channels, an operator does not need to bring in and form a dedicated team to investigate how these are implemented. This not only reduces expenditure, but increases agility and service velocity — vital tools in such a competitive industry.

Selecting the right partner

When making the decision to outsource the management and operation of playout services, there are a number of key factors that should be considered when selecting a partner company:

• Financial stability. Firstly, it’s vital to remember that this is a long-term relationship that is being entered into. Therefore, financial stability is paramount. A company with a strong background, as well as a healthy financial outlook, will offer peace of mind when looking ahead to a decade’s time and what can be achieved together.
• Working culture. Working culture also plays an important role in forming a successful partnership, and it is important that there is a similar mindset and approach between both parties, as well as a high enough level of cooperation and willingness to adopt new strategies. Both parties bring different thinking to the partnership, but there must be an underlying similarity in culture in order to succeed.
• The size of the partner company. The size of the partner company is a strong consideration as well. A larger organization enables scale beyond what a single operator can achieve. By using common tools, methods and processes, a large external partner can develop and industrialize new ideas rapidly, while achieving greater efficiency in network operations, service platforms and associated operations and business support systems. Furthermore, its purchasing power with third-party suppliers makes it a potentially far more effective negotiator than individual operators can be on their own.
• Agility. Agility also needs to be taken into consideration. Broadcasters do not want to be concerned about whether existing services will be affected in outsourcing playout management. Likewise, they want to know that when it comes to rolling out new services, these can be done seamlessly and with no delay. There is little point partnering with a company that knows of the technological benefits of new equipment, but lacks the know-how or experience to deploy it.
• Passion for television. Above all else, however, it is important to work with a partner company that has a true passion for television. That may sound obvious, but it must not be overlooked. You, the broadcaster, should feel safe in the knowledge that your partner company has long-term experience, knowledge and vision for how the industry is changing, and knows the technological challenges and opportunities that are on the horizon. A proactive, rather than reactive, partner will help enable a competitive edge and provide the next-generation services that viewers desire.
• Partner for change. In that sense, they need to act as a partner for change. The management and operation of playout services is essential, but the right company is the one that will offer advice, provide consultation and actively encourage new steps to be explored and deployed in order to push the viewer service offering forward.

Over the next few years, the shift towards multiscreen will see our industry move closer to realizing the vision of the Networked Society — a world in which all devices that can be connected to each other will be. As we make that transition, managed services can offer broadcasters the support they need to remain relevant and competitive in this multiplatform, multiscreen TV world.

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—Thorsten Sauer is Head of Broadcast Services at Ericsson.