Four More Challenges Facing Content Distribution

The Media and Entertainment (M&E) industry is complex, and many factors can impact content's ability to find an audience. Writing and producing an engaging story are only two elements of a profitable title release.

Here are four more factors that affect the worldwide success of a title.

1. Competition and fragmentation: With more OTT video services entering the market and competing for subscribers, consumers have more choices and opportunities for confusion. Streaming services offer original content exclusively on their platforms or license it to competitors to increase market share. Sometimes they do both, leading to content fragmentation and consumer confusion. This is evident in the current dispute between Warner Brothers Discovery and Paramount Global over licensing the animated series "South Park," which is available on both HBOMax and Paramount+. Not only can fragmentation negatively impact platform revenues, but it also risks reducing consumer satisfaction and increasing churn rates.

2. Regulation and compliance: Video content crossing borders is subject to different legal and cultural norms. Providers must comply with various regulations regarding data privacy, content licensing, taxation, censorship, and consumer protection. For example, the implementation of new privacy laws in several states, such as Virginia, California, Colorado, Connecticut, and Utah, grants consumers more rights and control over their data and requires video content providers to comply with strict rules on data collection, processing, sharing, and security.

The enforcement of existing online platform regulations, such as Section 230 of the Communications Decency Act, which protects them from liability for user-generated content, encounters challenges and criticisms from lawmakers and advocates who want to hold platforms more accountable for harmful or illegal content. Emerging technologies and trends likely pose additional regulatory challenges or opportunities. Creators can protect their rights and interests by observing how these regulations are discussed or implemented.

3. Quality and cost: As consumer expectations for video quality increase, so do the challenges of delivering high-caliber content via different networks and devices. Who hasn't switched channels because the title they're watching isn't sharp and clear? Resolution matters. Video content providers should invest in technology and infrastructure supporting 4K, HDR, VR, and other formats while managing bandwidth costs and latency issues. Balancing the cost and quality of producing video content that works on any device, such as special effects, animation, or live-action, can be a challenge, especially for productions with limited budgets. Faced with trade-offs between additional spending to create high-quality content or reducing production costs, creators may be required to make changes or edits to obtain approval for releasing their content internationally.

4. Innovation and engagement: As video content evolves with new technologies such as AI, AR/VR, blockchain, interactivity, and filters, providers must keep pace with changing consumer preferences and behaviors. Consumers have demonstrated a willingness to try new ways of engaging with content, and it will become crucial for creators and platforms to innovate or risk falling behind. The challenge is offering technologies ready for mass consumption yet not posing a risk to the content or the brand.

For example, some streaming services allow viewers to interact directly with content and influence storylines. For several years, Netflix has provided interactive shows with mixed market results, but development continues. TikTok recently announced an AI-powered "beauty filter" called "Bold Glamour," which changes people's appearance in real-time, raising ethical and social concerns, even among the creative community . This filter is not unlike the services offered by Flawless , which uses facial recognition to create AI-generated, lip-synced visual dubs in videos. Flawless also raises similar security concerns .

Good stories are the heart of media and entertainment, and they rightfully deserve much care, attention, and professionalism. But other factors that can and do contribute to market success are often overlooked or downplayed. The coming months and years will tell which methods and tools help introduce stories to more extensive and diverse markets. Many strategies attract viewers, but care must be taken to ensure that the benefits outweigh the risks. Sometimes discretion is the better part of valor.

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Spherex Classification Tool Now Approved for Home Entertainment Content in Australia

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Regulation

Classification

The Albanese Government has updated the Spherex Classification Tool approval to include ratings for theatrical releases, home entertainment, and streaming content in Australia. Spherex was previously approved to classify online films.

The update underscores the Australian Classification Board’s confidence in Spherex as a tool to help Australian viewers make informed choices about the content they consume. This means Australians can now access a range of new films sooner than they might across all formats and windows.

Spherex has a longstanding relationship with the Australian Classification Board. Since 2020, Spherex has collaborated closely with the Australian Government to ensure its technology reliably generates classification decisions that meet Australian standards and viewers' expectations.

As the world’s only commercial provider of local age ratings, Spherex has successfully produced classification decisions for high volumes of online content in over 100 countries. Since 2018, Spherex has issued over one million age ratings for digital content, including films, TV shows, and trailers, distributed by its clients worldwide.

Spherex customers, including Umbrella Entertainment, Madman Entertainment, and Sugoi Co., rely on its AI-based platform to obtain local age ratings in Australia and significantly improve efficiency, cost reduction, and market reach.

Discover how Spherex's cutting-edge AI-based platform can streamline your content classification process and enhance your market reach while reducing costs.

Visit spherex.com today and see how we can support your content distribution needs.

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nScreenNoise - Interview Spherex: Avoiding the cultural dead zone

Spherex

Culture

One of the conundrums of streaming is that although a service can deliver content globally, it is not guaranteed to be acceptable in a particular local market. Netflix found this out when it announced global availability in 2016 at CES and was quickly banned in markets like Indonesia, where some of the content was deemed too violent or sexual. In 2016, without boots on the ground in a local market, it wasn’t easy to assess whether a show or movie would be culturally acceptable.

Today, global media companies are acutely aware of the importance of their content’s cultural fit. Moreover, they have a company like Spherex to help them prepare their content to ensure it fits with any country of interest. I interviewed Teresa Phillips, the Co-Founder and CEO of Spherex, at the recent OTT.X Summit in Los Angeles. She explained how the company is leveraging AI and its massive cultural profiling database to help companies prepare content for target markets. She also explained how, in the near future, AI would aid the company in measuring a movie or show’s cultural distance from a regional market and help it avoid falling into the failure zone between cultural fit and novelty interest.

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Spherex Featured in the DPP's IBC 2024: Demand versus Supply Report

Spherex

Industry

Spherex was featured in the DPP’s IBC 2024: Demand versus Supply Report, a comprehensive look at how the M&E industry is meeting key customer demands. The report focuses on the topics of empowering creators, understanding audiences, engaging users, and innovating the newsroom. It also highlights many of the technical innovations seen at the recent IBC Show.

An article by Spherex’s CEO Teresa Phillips titled "Navigating Cultural Resonance in Global Media: The Art and Science of Culture Mixing" was featured in the report, exploring how Spherex is pioneering the future of culturally informed content.

Teresa shares how cultural mixing has become a critical strategy for creating content that appeals to diverse audiences in today's global media landscape. This phenomenon involves blending elements from different cultures to craft films and television shows that resonate globally while adhering to local regulations.

However, the process of culture mixing is fraught with risks. Superficial or stereotypical representations can lead to accusations of cultural appropriation or insensitivity, alienating audiences and damaging a company's reputation. For example, imposing Western concepts on Eastern content without proper context can feel inauthentic and jarring to local viewers. These missteps highlight the need for a nuanced understanding of cultural elements to ensure that content is respectful and engaging.

To address these challenges, M&E companies are increasingly turning to data-driven solutions. Platforms like SpherexAI utilize artificial intelligence to analyze visual, audio, and textual elements, providing insights into how well content aligns with cultural and regulatory standards across over 200 countries and territories. This approach helps media companies understand the "cultural distance" between a title's origin and its target market, enabling them to make informed decisions about global distribution.

By leveraging these advanced tools, M&E companies can go beyond traditional content localization. They can create media that actively engages and resonates with diverse audiences. As the industry continues to evolve, those companies that embrace culturally informed, data-driven approaches will be better positioned to succeed, fostering cross-cultural understanding and trust while delivering globally appealing content.

Download the report here.

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