The ‘streaming boom’, seen over the past decade, is far from over. Users continue to shift from analog media, such as television or radio, towards video and music streaming alternatives. While competition is expected to remain fierce and the race for the best exclusive content is likely to continue, current trends suggest there is room for multiple dominant platforms, provided they can differentiate their offering.
According to Digital TV Research, global online TV episodes and movie revenues could double between 2019 and 2025, from $83 to $167 billion. Around $16 billion will be added this year. The streaming market, also called the OTT (over-the-top) market, refers to all types of media services and content offered to customers directly online, bypassing traditional cable, broadcast, and satellite television networks and platforms. Important players are companies like Netflix, Spotify, Disney+, and Amazon Prime Video
A report titled ‘Streaming is the future of media’, Robeco concludes that digitalization of consumption is still profoundly transforming the media and entertainment industry. “Among the structural winners of this trend are streaming platforms. These have enjoyed strong success over the past few years, and their prospects remain bright despite the dire economic consequences of the Covid-19 crisis.” But success doesn’t come easy: it always needs producing the necessary exclusive content.
Subscribe to IO on Telegram!Subscribe!
“The future of media is certainly streaming.”Robeco Report
So far, the Covid-19 crisis has been a catalyst for online video adoption, as captive viewers accelerated their move towards these platforms. ‘Cord-cutting‘ – eliminating pay-TV subscriptions by cable or satellite companies – has increased, indicating that these customers are unlikely to return to their traditional viewing habits anytime soon.
The global streaming video market – “by far the most relevant segment for investors” – is dominated by the United States. “Giants like Netflix, Amazon Prime Video, Hulu and Disney+ compete against each other and against a myriad of smaller players, usually backed by either movie studios, local internet providers or TV networks.”
A similar development is happening in the music industry. The report: “Streaming has not only stemmed the decline in music consumption, but consumers are paying for music again, as the ease of use and vast libraries are providing value in excess of the usually low monthly fees charged.” Moreover, streaming platforms are expanding their offering beyond music adding all kinds of other audio content, including podcasts and audiobooks.
For video game streaming, the outcome is less clear-cut, for now, Robeco’s researchers conclude. “We remain in the early stages of cloud-based gaming and latency issues still tend to affect user experience for multi-player games, for instance. Yet broadband speed is expected to continue to improve in the coming years. It is therefore likely just a matter of time before video game streaming can really take off.”
Overall, the long-term prospects remain bright for the streaming industry, despite the dire economic consequences of the Covid-19 crisis. “The future of media is certainly streaming.”
Innovation Origins is an independent news platform that has an unconventional revenue model. We are sponsored by companies that support our mission: to spread the story of innovation. Read more.
At Innovation Origins, you can always read our articles for free. We want to keep it that way. Have you enjoyed our articles so much that you want support our mission? Then use the button below: