The Evolution of Streaming

31st December 2020

With the entrance into the streaming market of established brands like Disney, it really feels like big changes are afoot in the global television industry.  If that wasn’t enough, the Covid pandemic is busy catapaulting the television world fast forward ten years - almost overnight.  It will be fascinating to see who will be the winners and losers in this new era for television.  Aquilanta asked three industry experts for their take on how the streaming market is shaping up and whether the traditional broadcasters can compete in this new world order.

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Indy Datta

Vice President, Legal & Business Affairs, UK & International

SF Studios

 

 

Diana Howie

Founder and Executive Producer

Fandom Fiction & Ridgeway Films Inc

Ivan Garel-Jones

Chief Operating Officer, All3Media America

How do you think the streaming market will develop over the next 2 - 5 years?

 

Indy Datta: A bit of conventional wisdom I’ve heard a lot over the last few years is that Netflix will struggle to compete when the deep-pocketed behemoths of old media enter the market in earnest. Maybe things will still play out that way, but at the moment Netflix’s first-mover advantage looks formidable, and none of the other potential global players seem to want to go toe-to-toe with them in every genre and territory at volume.  I hope as much as predict that there will be room for smart niche operators for the sake of the diversity of content that you can’t count on the big guys to deliver – and it may be notable here that the likes of Mubi and Criterion Channel are not pure online plays. The role of aggregators like Roku could well be key here.  But predictions seem reckless at the moment when, for example, the future of theatrical exhibition looks so uncertain.

Diana Howie: Streaming is predicted to continue to grow and the traditional, global streamers (eg Netflix, Apple+, Hulu, Amazon, You Tube, Disney+) will account for some of that growth over the next 2- 5 years but demand for a different, more personal, interactive kind of viewing experience is on the rise and will be a huge part of the streaming market in the next three years.  This demand is coming from a younger demographic, of both genders, and the new platforms they are populating are Google’s `You Tube Gaming Live’ and Amazon-owned `Twitch’.  These are online sites that allow users to watch or broadcast live streaming or pre-recorded video of video game play.  Twitch broadcasts often include audio commentary from the player and sometimes they add video, via their webcam, on the side of the screen.  There's also running chat from viewers on the screen that the broadcaster can respond to if he or she wishes.  Recently, US House representative, Alexandra Ocasio-Cortez, mobilized youngsters by streaming her video play of the game ‘AMONG US’ on the Twitch platform.  Ocasio-Cortez’s stream drew more than 430,000 concurrent viewers and nearly five million total views over the course of three and a half hours.  It's only a matter of time before these new platforms broaden their offerings beyond gaming.

Ivan Garel-Jones: The pandemic has accelerated the push to streaming services, coinciding with the largest studios (Disney +, Peacock, HBO Max) launching their offerings in direct competition to Netflix.  Disney and Peacock have seen significant take-up, and Warner Brothers have pivoted to launch their 2021 movie slate day in date in theatres and HBO Max to attract subscribers, perhaps reflecting studios’ priorities in the future.  Over the next few years, we will see the studios continue to leverage their existing intellectual property libraries to fuel an aggressive roll-out of their platforms around the world.  Netflix will continue to use its first mover advantage and aggressive spending on original content to stay ahead of the market as it seeks to sustain its advantage in the medium term, against an onslaught from studios with decades of library material to populate their services.  

Can traditional broadcasters compete?

ID: Scheduled linear delivery is still the best way to get shiny floor, sports and events to audiences – and the deep expertise of traditional broadcasters in these genres is not easily replicated.  But I was going to put News in that list, and thought better of it, which suggests that complacency is a trap here.  This isn’t money that the new entrants will want to leave on the table forever, and indeed we see Amazon investing heavily in Sport and Netflix possibly piloting a scheduled service soon.  I don’t think “either/or” thinking works here: the old players will have to move into the new world just as much as new players will need to learn what isn’t going to be rendered obsolete.

DH:  The only way to compete is to think globally and, at the same time offer more bespoke personal fulfilment that goes beyond the life of the traditional, linear programme.  Think big but think personal, too.  Scheduled TV is a thing of the past so traditional broadcasters should look beyond simply playing out their titles and start to build wider, commercial offerings around them.  Disney did this decades ago with their theme parks and there has been recent talk, in the US, of TV Networks and streamers buying up the now obsolete cinema properties to provide broader offerings around their content.  For example, fans could attend exclusive premieres of their favourite shows, meet the cast, buy branded merchandise and experience unique interactive, branded games, rides etc, as well as meeting fellow fans.

IGJ: Broadcast in the US can continue to compete successfully.  Increasingly, this will become a function of how it fits into the larger eco-system that is direct-to-consumer.  There is still room for appointment viewing, particularly in sports, and broadcast networks will be competing aggressively over the next few years to secure long term deals for the most popular sports (NFL, NHL, NBA etc).  It will be great for sport franchises as the competition will mean the prices for those deals will be going up substantially.  Writers and show-runners are still seeing value in broadcast deals where a successful series can generate meaningful back end participations.  Cable will be seeking to maintain the dual revenue model (advertising and subscription) as consumers are enticed to switch from the traditional cable package to a suite of streaming services.  I would expect more alignment between streaming services and strong cable brands, particularly in the non-scripted space, such as the deals that A&E and BBC made to include a suite of programming within Discovery +, and a similar deal between A&E and Peacock.