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Online Streaming

15 January 2016 |

Data from Statista suggests the demand for streamed online content of video is likely to double in the next 6 years. This provides huge opportunities, not only for incumbents, but also traditional broadcast companies looking to benefit from a very lucrative market. Though many firms have concentrated their efforts into the large US market, they are also expanding their coverage of European nations.

Netflix: Starting life as a method of mail ordering DVD’s to the home, Netflix quickly transformed its business model to one that fits the digital age. It has seen significant growth of the past decade and has come to embody the transition to streamed content in digital media. Although known most prominently for its’ extensive library of feature length movies, Netflix has also taken the step of producing its own content, with Daredevil, House of Cards and Orange is the New Black key to the attraction that is faces. However, given most of its primary content generation has focused on TV shows, it remains to be seen whether a streaming service that offers all episodes in one sitting can attract the same excitement as a typical TV schedule. We also note that growth has remained at a constant rate in the USA whilst there has been particular expansion internationally. In order to maintain this high level of success, Netflix will have to continue to attract this new audience by catering content to those external to the USA.

Hulu+: Launched as a collaboration between NBC Universal, Fox Broadcasting and Disney-ABC, Hulu was an attempt by traditional US media corporations to penetrate the online market place. Not famed for its selection of movies, Hulu is able to bring customers the widest selection of TV shows available on the market, siphoning much of the best TV available from the USA, including Family Guy, Empire and Dancing with the Stars. And given that it has both a subscription, pay per view and free content (revenues originating from advertising), Hulu is able to price discriminate to the highest quality.

NowTV: Available in the UK, NowTV is Sky’s answer to online upstarts and is an attempt to bring Sky’s very successful subscription based platform to its users. Providing various packages including Sports, Entertainment and Movies, prices range from £6.99 to £9.99. However, by focusing solely on the UK market, it has been unable to generate critical mass required and as such, has been unable to attract the highest quality content, usually produced in the United States.

AmazonPrime: Amazon has done tremendous work in expanding its user base beyond typical online shoppers, and the media offering of prime is only one part of an entire package that includes providing same-day delivery of goods, online streaming of music as well as priority viewing of certain products on offer. Beginning as a small pay per view service, content has grown massively with contracts signed with Epix and Warner Brothers. However, it has been the capture of former BBC presenters Jeremy Clarkson, Richard Hammond and James May (Top Gear’s trio) on a $200 million contract that acted as a signal of intent from Prime. Although costing $99 per year, there is huge value for money given the wide range of services provided by Prime, particularly for those who shop on Amazon regularly.

YouTube & Google Play: Free to browse, and generating revenue through numerous adverts that have not particularly antagonised customers, YouTube is Google $1.6 billion dollar acquisition that for a while, had cornered the online video market. Although there is greater competition at this stage, YouTube does not try and compete with other feature length movie providers. Instead, the sheer range of video content available, including numerous vloggers and gaming enthusiasts, YouTube will continue to expand its reach particularly given that the smaller the screen, the lower the average length of viewed video. Attracting other customers looking for new releases, Google Play will charge $5 for HD and $4 for normal content video. As it does not charge a subscription fee, Google will act to supplement other streaming sights rather than looking to replace them, and will do a very good job attaching itself to either end of the market.

Sling TV: A new release from ESPN, Sling looks to tackle the traditional market for cable TV in America by offering streamed content of sports (ESPN), entertainment (Comedy Central) and various other channels, which now number over 200. However, it lacks much of the content that others offer in terms of premier movies, and given the already saturated market in America, there is very little room with which it would be able to grow. However, at $20 per month, it is a three-fold saving on the typical cable contract and with greater awareness, it could be the ideal tool for sports viewers looking to save money.