How video streaming business models might change in the future now is a growing issue. For the past several years, most content owners have been working to assure investors that they have a growth plan for transitioning away from linear formats and towards on-demand streaming.
The new issue raised by slowing Netflix subscription growth is the addressable market potential. Might the potential market be smaller than earlier forecast? And though original content on a global scale has been an unquestioned tactic in recent years, observers are starting to wonder what changes if growth starts to slow.
How much investment in original content makes sense? The other issue is whether subscription fees are sufficient to drive the revenue model or whether some shift, where possible, to other monetization schemes begins to make sense.
Think Amazon Prime with its “free shipping” focus, or ad-supported services, product placement fees or licensing original streaming content to linear services. Some might ponder whether a streaming subscription could be bundled with other services beyond video entertainment, such as gaming or delivery services.
Netflix is at least considering introducing release windows for its top original content, shifting to the older model of theatrical release before making new content available to other distributors. And though Netflix was built on a foundation of pre-recorded content, it is thinking about getting into the business of non-scripted live video as well.
Content owners are looking at different revenue models as well. All of that means video streaming might be heading towards a hybrid model where multiple revenue streams are relied upon: subscriptions, advertising and transactions.
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