With the dawn of the rapidly evolving digital century, new windows of opportunity are emerging for different industries such as telecommunications, content providers and digital developers in emerging markets.

This is particularly the case with inventive macro-level digital drivers such as smartphones, internet adoption and network availability for the increasingly tech-dependent user population.

Indeed, one such opportunity relates to video-on-demand (VoD), and this is proving to be the fastest-growing consumer revenue model based on digital subscriptions worldwide, according to the latest figures.

Subscription video on demand (SVoD) services such as Netflix are expected to grow to 6.4 per cent in the households of emerging markets by the end of 2019, increasing the user base to 102.7 million, according to Pyramid research.

The Mena (Middle East and North Africa) region has been quick to see the potential of VoD. Since the hotly anticipated launch of Netflix came to the UAE — alongside 130 other countries — earlier this year, more telecom players are seeking novel ways to tap into these potential revenue platforms.

In developed markets such as the US, VoD service providers have toppled long-time dominant cable players such as Time Warner and Comcast, and the emerging market landscape is set to catch-up.

The reasons for such divergent transition in digital consumption is obvious for traditional cable providers upon close inspection, which include VoD offering users more affordability, content diversity, digital experience, and viewership autonomy.

Netflix is an admirable example of how some rising content provider superstars are tapping prospective revenue reservoirs right on the head. Since Netflix has already established itself in as North America, Europe and Australia, it is exponentially growing its footprint in emerging markets such as Asia, Africa and of course the Mena region.

But there also exist several hurdling challenges for the over-the-top content (OTT) video market in emerging markets that entrants must watch out for. This includes aspects such as the prominence of piracy, access to differentiated content, low affordability and slower internet speeds.

Nevertheless, some telecoms market players have been proactive and have already outlined adaptive strategies to enable them to successfully enter and root their feet in the video offering market.

As such, there are key ways in which telecoms providers can proactively triumph in this growing video streaming market. This relates to: (1) Organic development (2) Partnerships and (3) Inorganic development.

Strategy 1: Organic development

Here, to maintain optimal control telecom providers rely selectively on third-party service providers for content procurement and technical development to attempt to develop the VoD product organically. For example, Telefonica (Spain’s multinational telecommunications provider) appointed Grey Juice Labs (as content aggregator) for its video streaming services in Argentina and Chile, or MTN in South Africa developed its VoD offering FirstRow through a partnership with Vubiquity content aggregator platform.

Strategy 2: Partnerships

In Africa, two prominent telecom groups decided to get into distribution agreement with iROKOtv to provide the best of online Nigerian films and movies online to users.

More specifically, in Rwanda (Tigo) and in Ghana (Vodafone) teamed-up with iROKOtv to provide unmatched entertainment experience for broadband customers.

Strategy 3: Inorganic development

Some market opportunists have opted to develop fresh revenue streams to lead in the digital space, such as PLDT (Philippine’s telecom incumbent) by investing $15 million with iflix (leading VoD service provider) across Southeast Asia.

In essence, the bottom-line for telecom industries to take home is that they must focus their efforts on understanding emerging market trends and respond accordingly. In today’s case, it is developing a compelling proposition to remove barriers of adoption while retaining the audience through exceptional experiences.

Ultimately, they can then proactively accelerate their gameplan to set foot in the right direction.

— The writer is a partner at the advisory and investment group, Delta Partners, which specialises in the telecoms, media and digital space.