An ARF event presented by the LA Media Research Council focused on insights from 2022 research and on 2023 priorities to meet business challenges. Issues addressed in research presentations and by an expert panel included the evolution of streaming during an economic downturn, how to manage subscriber churn, understanding Gen Z and the continued need for better measurement across the ecosystem.
In this session, Edwin Wong of Vox Media moderated an expert panel who made predictions on what the media experience will be like in 2023 and beyond for the consumer. When asked whether SVOD was going away, Brian Further of Nielsen reminded of what people said about cable, that people would not pay for it and at its height some were paying over $200 per month. Jon Giegengack of Hub Entertainment Research said spending continues to go up on SVOD. But bundling may be a way to have people keep subscriptions longer, since the payment is simplified, and they are less likely to cancel than when they pay for SVODs individually.
Yan Liu of TVision highlighted a fresh study to be published in a month or so, illustrating the relationship between attention and churn on SVOD and AVOD platforms. TVision partnered with Antenna who track audience trends and their impact on subscription rates, for the study. Cross-referencing Antenna’s 2021 churn data with TVision’s aggregated platform data (from Apple TV, Discovery+, Disney+, Hulu, Netflix Paramount and Peacock), they found an inverse correlation between the top 50 shows and the churn rate. As attention increases, churn decreases and vice-versa. The popularity of any one platform varies month-by-month, depending on what popular content has been released where. When a popular original debuts, viewers gravitate toward it. But low attention viewers drop off once they’ve finished the series. Churn is the norm and unfortunately not an easy issue to solve in the near-term. However, co-viewing and live CTV content like Amazon Prime Video’s Thursday Night Football lessen churn.
Jon Giegengack of Hub Entertainment and Wayne Goldstein of Sony Pictures uncovered facets of streaming that display a potential pendulum shift toward more familiar aspects of linear TV. For instance, consumers now want content aggregation and a bundling option to help find content across different platforms. This need for simplicity of use extends to the rise of smart TVs, lessening the number of remotes to manage or buttons to push. TV advertising has entered streaming in a big way. In an age of bingeability, appointment TV has also cropped up. Another adoption from linear, FAST is featuring more programs that help us enjoy our downtime, where we can retreat from the day, lean back and unwind, as opposed to the immersive programming that’s been a stalwart of streaming.
Brian Fuhrer of Nielsen outlined trends in “the streamosphere.” Not only has streaming grown tremendously, but there has also been great fragmentation driven by a proliferation of new platforms. Viewing on different platforms changes from month-to-month, depending on what highly anticipated show is coming out. While streaming service providers seem to be able to grab viewers, they wrestle with keeping them. FAST platforms are growing rapidly as older demographics and more diverse audiences flock to them. Certainly, for any streaming platform, adding more diverse content can drive usage and broaden the base. He also talked about the “summer of streaming.” Platforms drop lots of popular content during the summer months—when the networks see a lull, causing a spike in viewership.
Tracey Chen of Warner Bros. Discovery walked the audience through the details of their 10-year Video Now study. On demand usage has become universal from baby boomers to Gen Z, while linear TV continues to decline year-over-year with each age group. This is especially true among younger and multicultural audiences. Time spent on SVOD doubled in 2021 while linear TV declined from 20% to 12% in the same period. Now, consumers’ willingness to pay for subscriptions is cooling, allowing AVOD and FAST services to flourish. Fifty percent of consumers have used a FAST service. Roku is the most popular while Tubi saw the biggest year-on-year growth.
Tania Missad of Warner Bros. Discovery introduced the audience to their Video Now study, a 10-year project investigating the evolution of the viewing landscape, which includes the growth of streaming and further erosion of linear TV. The study found that people are now less willing to spend on streaming apps and other options due to frustration with rising costs. They also feel overwhelmed by the number of services. This is causing low and no cost options such as AVOD and FAST to flourish. Besides cost savings, viewers like that AVOD and FAST have large libraries of content to explore. What consumers want now is bundling discounts, improved content discovery including aggregating desirable content across different apps and more personalized recommendations. There’s also a growing interest in more diverse stories and international content.
On October 25, 2022, media and measurement experts shared the latest research-based insights about today’s media landscape at OTT 2022 held on the Warner Bros. Discovery Studio Lot in Burbank, CA. Attendees learned more about what viewers really want when it comes to FAST, AVOD and SVOD, and whether there are viable solutions for cross-platform measurement.
Yes, there is upheaval in the media industry. The press paints a dire picture of viewing, yet Radha Subramanyam (CBS), focuses on growth. Total viewing is up 2% year over year, broadcast share of total viewing up 2%. CBS viewing also is up 2% year over year—across entertainment, news and sports, 8-10 shows averaging over 10 million viewers nightly. When it comes to reach and “unique,” it’s an even bigger number in streaming, particularly entertainment. There’s great momentum in sports and women in sports.
Fifty years ago, defining TV was pretty simple but the video landscape has changed dramatically in the last 10 years. Video is growing today, and this is driven by CTV. TV formats have their own personalities and content to define them. TV should not be approached in isolation because that is not how consumers approach it.