i3 - May/June 2020 - 37

By Brian Comiskey

Business

BY T H E N U M B E RS

On-Demand
Escapism
ith social distancing
becoming the new
norm in American
daily life, video streaming services are poised to capture our
growing undivided attention.

NEW ENTRIES IN SVOD SERVICES
SPUR GROWTH POTENTIAL
Consumer spending
($ billions)

W

14.2

5.1

6.4
25%

8.3

30%

17.8

20.5

21.9

23.0
SVOD

11.5
YoY
Growth

40%

20%

20%

10%

7%

5%

2015
2016
2017
2018
2019
2020
2021
2022
2023
The latest released figures from streaming service providers show companies
SOURCE: CTA MARKET RESEARCH
closed out 2019 and entered 2020 at
subscription rates higher than Wall
Street's projections. For example,
The postponement and outright canproviders have demonstrated an ability
Disney+ had amassed 28.3 million subcellation of major sporting events also
to adapt to these emerging challenges.
scribers since launching in November
could negatively impact live TV streamOn the content perspective, SVOD plat2019, Hulu had reached 30.4 million
ing platforms like Hulu Live and
forms are offering individual purchase
subscribers for both its on demand and
FuboTV that have made live sports cenaccess to recent theatrical releases such
live offerings, and Netflix had accumutral to their pitch in content strategy.
as the Invisible Man and Emma on
lated 60 million U.S. subscribers. All of
Meanwhile, the suspension of producPrime or, in the case of Disney+, openthem exceeded their projections.
tion for most new shows and movies
ing the vault earlier for their own films
CTA estimates that
will also lead to delays
like Frozen 2 and Onward to cement
the video streaming
in
the
content
releases
themselves as the family option when
CTA estimates
market will reach
that often retains subisolating with children.
that the video
about $24.1 billion in
scribers and captures
Newer services entering the fray can
streaming market new viewers.
revenue in 2020, replean on their catalog of proven streamwill reach about
resenting a 29%
Regulatory coning juggernauts like Peacock, with
$24.1 billion in
increase from 2019.
straints also present a
Friends, or bring an oasis of unreleased
Within this, subscrippossible
roadblock
in
shows, like Quibi.
revenue in 2020,
tion video on demand
the
growth
of
streaming
Beyond the shifts in content release
representing a
(SVOD) services are
markets during the
schedules and marketing tactics,
29% increase
forecasted to reach
coronavirus outbreak.
streaming services have adapted their
from 2019.
$14.2 billion in 2020,
YouTube, Amazon, and
pricing strategies to capture wider audiwhile "over-the-top"
Netflix have all agreed
ences. Disney+ and Hulu have capital(OTT) or live multito reduce streaming
ized on bundle offers and lower price
channel streaming platform will hit just
quality in Europe to prevent broadband
tiers to establish themselves as lower
above $6.3 billion in revenue this year.
outages amid increased internet usage
budget streaming options. Niche seracross the continent. Disney+ has postvices like Shudder, Sundance Now, and
poned its launch in France as part of an
Acorn TV are extending their free trials
Curb Our Enthusiasm?
effort to curb broadband pressures
for consumers.
However, downward market pressures
Ultimately, the uncertainty over the
may be on the horizon for video streaming from streaming. The introduction of
similar measures or even more strinlongevity of this pandemic may present
services as the grim financial and social
gent regulations on streaming service
challenges for the streaming market.
realities of this pandemic cement themusage stateside could further turn subHowever, with the hasty content shifts
selves over the course of the year. First, as
scribers away from these services.
and marketing strategies enacted by
Americans begin tightening their belts,
platforms already, the escapism offered
video streaming services could be cut as
by video streaming may buoy this marhouseholds look to remove non-essential
Ensuring Content is not Frozen
ket in the near term. ■
costs in their budget.
Fortunately, streaming service
C TA . t e c h / i 3

i3_0520_37_Business_ByTheNumbers.indd 37

MAY/JUNE 2020

37

5/11/20 9:48 AM


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i3 - May/June 2020

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