One hears a lot of talk about how different broadcast TV content strategies are from video streaming content strategies. The argument is that broadcast TV and video streaming services catered to different audiences, with distinct revenue models. Some of us cannot see that continuing.
At a high level, the consistent trend in “video” markets has been in the direction of personalization or customization, on-demand consumption and a shift to viewing of titles rather than “channels” that mirrors and is part of the same trends in nearly all forms of media.
The key implication is a shift of most of the business towards personalized, niche, custom or more-specialized audiences rather than the broad-appeal audiences the broadcast TV networks have required.
Where broadcast TV has relied on advertising revenue generated by content pitched to large audiences with content of wide appeal, including sitcoms, dramas, and reality shows, streaming has been characterized as a subscription model, with content often aimed at niche audiences often featuring genre-specific shows, documentaries and foreign language content.
But those generalizations are breaking down. Already, video streaming services are moving to ad support plus live (scheduled) programming, especially sports. And that blurs the lines between “broadcast” and “streaming” content and revenue models.
The example one always hears is that “eventually, the Super Bowl will be on streaming,” the point being that the National Football League consistently generated the top “live” programming events, with advertising being the revenue driver.
Were NFL events to shift to streaming distribution, so would audiences and revenue models follow the shift. The point is simply that streaming substantially substitutes for broadcasting in terms of viewership and revenues.
And most predict that the role of broadcast programming will also shift over time as a result, becoming a smaller part of the total content revenue stream and also therefore shifting its role. Many expect a shift to substantially more reality TV as the broadcast staple.
Others also expect the broadcast role to shift more towards the role theatrical exhibition has had for video markets, namely building interest and word of mouth for eventual on-demand or pre-recorded media release.
In that sense, the content distinctions between broadcast and streaming services might be less important. Perhaps it is the role of broadcast TV that changes, in the direction of the role theatrical release now has for movies: building word of mouth for eventual on-demand exhibition.
Beyond those changes, one might note a generalized switch in business models in many industries from one-time purchase to subscriptions, enabled by online and internet platforms that enable them.
The other obvious change is from one-time purchase to on-demand purchase and consumption.
AI might affect on-demand and one-time-purchase models using personalization.
But the impact on subscription business models is less clear, except that subscription payment models often are a way to support on-demand consumption. Streaming video services and e-commerce subscriptions such as Amazon Prime provide examples.
“U.S. consumers may be willing to endure more ads and be corralled into bundles, but they may not be willing to give up the degree of customization they gained from unbundling pay TV, or the personalization they enjoy from social media, say consultants at Deloitte.
In other words, streaming “subscriptions” basically are favored because they provide on-demand viewing, much as earlier generations of technology (VCR tape rentals, DVD rentals) enabled on-demand, personalized consumption of content.
Linear broadcast bundles have tried to provide choice by providing many genres and content formats, even if broadcast schedules are part of legacy media formats requiring consumers to adapt to provider schedules.
Streaming subscriptions also are a platform for custom and personalized choice, allowing consumers to watch what they want, when they want it, and not on a fixed schedule. Digital video recorders, in essence, are an attempt by linear video providers to create some amount of on-demand consumption.
To a large extent, streaming also is favored because it is a “multi-screen” format, allowing native consumption on phones, tablets, gaming devices or televisions. Linear TV providers replicate that feature using their own proprietary streaming services.
So the argument that content strategies for linear broadcast and streaming are “different,” as much sense as that has made, arguably is changing. “Appointment television” now consists largely of sports or other events, but a slow movement of such content to streaming is happening.
As linear audiences shrink, so will the necessity of assuming large audiences are the target (“large” is a relative term, of course, looking at streaming content audiences by title instead of TV networks). In fact, we already can see that many linear TV series that did not do so well on linear services can become “hits” on streaming services.
And the same can hold for movies that did not perform so well theatrically.
The point is that the same “big audience” formats thought to be essential for linear broadcast also often make sense for supposedly-niche streaming services. So a blurring of lines and strategies is taking place.
Such a hybrid model is found in other industries as well. Private computing coexists with cloud computing. The rise of cloud computing hasn't eliminated the need for on-premise data centers, nor have entities stopped buying their own computing gear in preference to renting computing cycles and storage.
Streaming services such as Spotify and Apple Music have become popular. However, vinyl records and physical CDs continue to be produced and collected by enthusiasts.
The rise of e-readers and audiobooks hasn't eradicated traditional printed books. Movie theaters still have a role in the content value chain.
People use online shopping but also visit stores. They travel but also use videoconferencing. You get the point: a hybrid video model is coming.
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