The streaming landscape is ever-changing, but the reality is this state of flux is fundamental to an industry built upon rapidly meeting the evolving demands of consumers. Last year saw nearly all streaming services hike up their rates, driving subscription prices to an all-time high with 44% of Americans seeing an increase in their streaming subscription costs. But as streaming companies widen their offerings and look for opportunities to enhance experiences to meet consumers’ shifting needs, it’s no surprise that the cost of subscriptions has grown alongside additional efforts to expand revenue streams.
A rise in pricing may appear the antithesis of an improved experience but, contrary to popular belief, cost isn’t the biggest factor for consumers when it comes to streaming or selecting an entertainment provider. Research from Amdocs, a leading provider of software and services to communications and media companies, found that consumers instead are more focused on the areas that bring value to these rising costs.
So what do consumers care about when choosing a streaming service?
Amdocs’ “The New Streamer 2024” report recently found that original content (72%) is the top feature consumers believe makes a subscription worth the investment, followed by ew content every few weeks (59%), access to older titles (55%) and the ability to watch content anywhere (49%).
Four trends shaping the state of streaming
Profitability and subscriber growth have been long-term challenges plaguing streamers. Following another year of losses with subscription growth plummeting to 10.1% in 2023 vs. 21.6% in 2022, the industry faces the daunting task of identifying new ways to increase profitability that are also in line with the expectations consumers have around their viewing experiences. As providers seek more avenues to bolster revenue and meet viewer demands, four key areas are shaping the streaming landscape.
1. ) Ad-supported plans
From Disney+, Netflix, Max and now Amazon Prime, ad-supported plans are an option that streamers are exploring in their quest to generate income. Amdocs studies reveal that emotions around classified ads vary from generation to generation, with almost a portion of younger generations open to seeing more classifieds. The rise of streaming advertising offers a unique look at how providers are responding to increasingly trendy viewer behaviors.
Ad-supported offers are here to stay according to Raman Abrol, CEO of Amdocs and CEO of Vubiquity. “Streaming ad breaks requires a sensitive balance, and as those types of offerings continue to emerge, we can expect ad lengths to continue to become shorter. This shows the audience that their time is valued and at the same time increases competitiveness between advertisers in desired locations. In return, streamers increase their earnings while keeping their subscribers happy.
2.) Cloud Gaming
Cloud gaming is another domain that vendors are experimenting with, and it’s a domain that is turning the definition of “streaming” on its head. For example, Netflix recently began testing its cloud gaming services, adding the creation of a game catalog with popular titles such as Grand Theft Auto: The Trilogy. Apart from Netflix, other major players like Microsoft are also investing heavily in transforming gaming into a subscription style over the cloud. These investments, along with Amdocs’ findings that 70% of Gen Z are interested in accessing cloud gaming through their streaming subscriptions, offer insight into where streaming is headed in the long term. .
Streaming is transforming beyond just watching and younger generations are hungry for offerings that take this into account. As cloud gaming becomes commonplace and demands for streaming integration increase, partnerships between streamers, gaming ecosystem players and service providers are likely to strengthen to deliver the enhanced connectivity and features that Consumers are looking into a “post-console” world.
3. ) Live Sports
Live sports have become a popular product in broadcasting, especially in recent months. From Netflix’s deal with WWE to Peacock’s exclusive deal for the NFL playoffs, providers are working tirelessly to secure exclusive deals and partnerships with sports leagues.
According to Amdocs’ report, 64% of consumers believe the availability of live sports is an important factor when it comes to selecting a streaming provider. With viewers having a clear appetite for live sports, we can expect this battle to heat up among streamers as they look for more sports offerings to test the waters with.
4. ) Consolidation
Streaming companies spent a record amount producing original content last year but, as they continue navigating a constantly evolving market, this trend’s momentum has halted. Despite once being viewed as a prized asset, the cost of original content is eating away at profitability for streamers. This presents a massive dilemma as consumers consider original content a top feature. Streaming platforms must now delicately strike the balance of meeting their customers’ content expectations while protecting their bottom line.
Abrol believes consolidation will be the answer, “We’ll see more consolidation of streaming platforms, bringing together deeper libraries of content, and offering more overall choice to consumers. We’ll also see a new wave of syndication efforts across the streaming landing, as we’ve already begun to see with HBO content being licensed to Netflix.”
Innovation will retain visitors
While the distribution efforts will help expand content offerings, Abrol says they will also force providers to confront other challenges: “Providers are already struggling to retain and grow their subscribers. As streaming sites air their content original to others, they will want to find new tactics to differentiate themselves in order to strongly retain their subscribers.
In the never-ending streaming wars, retaining consumers and status outside of the festival has proven to be an uphill battle. According to a recent survey from Prosper Insights & Analytics, 26% of consumers cancel some entertainment subscriptions due to price increases. This, along with Amdocs’ findings that consumers expect improved reporting at higher costs, demonstrates the need for streaming companies to offer better reporting to retain consumers.
television broadcast
Luckily, advancements in emerging technologies are setting up a prime opportunity to reimagine existing offerings and services.
Immersive reporting powered by generative AI, virtual truth, and blended truth may still be in the early stages of its meteoric beginnings, but mastering fluid and advanced interactive reporting allows streaming sites to attract new consumers and provide consumers with convincing reports exist. they wait.
“This will be a wake-up call for the industry,” Abrol said. “Customers have increasing expectations about how they need their entertainment reports to look. The long term of streaming is largely based on differentiation, and the way forward will be to require more content innovation and new offerings. The first in adopting technologies, from GenAI to blended truth, they will be the most productively positioned to succeed.
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