Consumer exposure to advanced recommendations engines will grow to reach 75% of Pay TV households on multiscreen services and 55% on set-top boxes within North America by 2018, up from 20% and 10% in 2013, respectively, according to ABI Research (http://www.abiresearch.com).
This significant growth is driven by today’s highly competitive viewer landscape for Pay TV and OTT operators, says the research group. At the core of this are search, recommendation and discovery technologies that rely heavily on rich metadata as well as user analysis and learning.
“TiVo’s acquisition of recommendation specialist Digitalsmiths is indicative of the tight relationship between guides, metadata, and recommendations,” says ABI Research Practice Drector Sam Rosen. “We expect further consolidation moving forward as recommendations move from a wish-list item to a must-have in today’s competitive environment. Consumers whose experience is upgraded by comprehensive recommendation implementations routinely show better business metrics, including lower churn, increased ARPU [average revenue per user], engagement with new types of content, and engagement with VOD platforms.”