From binging to watch parties, our favorite streaming platforms have evolved dynamically over the past ten years. The last decade has seen a rise in innovation alongside consumer shifts that have led to a changing landscape for video streaming industry growth.
One thing is certain; streaming platforms are on the rise. According to a 2022 study reported by Forbes, viewing time grew exponentially around the world over the past two years, with Asia leading video streaming growth. The study determined that Asia (outside of China) was up 172% compared to the same quarter the previous year, with Africa and Oceania increasing by 50% or more, and South America growing by 34%. The study notes that "even the topped-out markets of Europe (up 9%) and North America (up 5%) still saw some growth in viewing time." This means the overall household engagement is rising at a steady, sustainable rate when it comes to streaming platform trends.
Of course, not all streaming platforms have experienced the same meteoric rise as Disney+. Take CNN+ for example as well as some unsuccessful smaller streaming platforms that have fallen flat over the last few years (Peacock, we're looking at you). Understanding the failures in video streaming industry growth can better illuminate the ways streaming platforms are driving engagement in 2022.
Our experts have compiled the highlights of video streaming industry growth to take a closer look at the hits, the flops, and the enduring trends of streaming platforms.
The Classics: What Made Netflix a Game Changer?
Most assume that streaming began with Netflix. However, another industry titan deserves the credit for leading the streaming revolution.
First generation streaming platforms exploded in the mid-2000's, pioneered by the founding of none other than YouTube. Upon seeing YouTube's meteoric rise, Netflix—originally a mail-to-home DVD rental company—changed their strategy and became the internet-based streaming service famous for great shows to chill by.
YouTube was acquired by Google just a year later for a whopping $1.65 billion. This was significant for a new type of technology and further confirmed that video streaming industry growth was a sure investment. This prediction turned true with a significant rise in streaming over the next decade.
So what was it about streaming that made these platforms so popular? A few key factors are readily identifiable:
More affordable than cable
Accessible
Less equipment required
Watch from anywhere (vacation, cars, class, etc.)
Watch from any device (mobile, tablet, laptop, TV casting)
More variety, no late fees
Customizable, personable
As viewers flocked to streaming services thanks to these factors, many traditional media delivery vehicles found themselves obsolete. Streaming services built empires on the backs of traditional content like The Office and Friends. As these contracts expire, you see many broadcast and cable companies taking back their content and entering the streaming arena. The pressure to keep up with the market is more intense than ever before.
Rising Stars in Streaming
What makes a streaming service stick? There are several key ingredients that have emerged over the last decade that merit a closer look.
Personalization is among the top qualities viewers seek in media and entertainment alongside automation. Today's consumers don't want to spend hours scrolling for the perfect show. They want a streaming platform that knows their preferences and can make smart recommendations based on shows they'd actually like to watch. Streaming platforms are becoming smarter every day with advanced AI technology to drive recommendations and allow a higher degree of customization.
Platforms such as YouTube are leading the way in developing a brand built on consumer trust. When discussing what makes good content, YouTube stated, "our bond with viewers is tighter than that of TV, streaming or social media."
A great reputation has cross-selling potential. As TV advertisements fade, more and more consumers have turned to streaming platforms for product recommendations. Eighty-nine percent of viewers agree that YouTube creators give recommendations they can trust. This boosts secondary revenue and creates an even greater need for online streaming platforms as a means of staying connected.
Diversification is a key asset in video streaming industry growth. The last decade of streaming has seen a rise in the creation of "own content"—that is, original series developed by Netflix, Hulu, Disney+ and others. Streaming services are not only finding a way around the battle for rights to pre-existing shows, but they're also establishing brand loyalty in the process.
For instance, Netflix is known by dynamic original series such as Stranger Things and Ozark. This strengthens viewer engagement by associating the platform with a favorite must-watch series in the same way that Disney is associated with Marvel (and Disney+). In fact, streaming companies are diversifying into production at a significant rate. Netflix spent around $15 billion on original content in 2019, according to Forbes. Streaming platforms are discovering that the investment is well worth the ROI when it comes to video streaming industry growth.
Other areas of growth include delivering more niche content for niche demographics not captured in the generic streaming model. MagellanTV and Shudder are great examples of niche streaming platforms, specializing in documentaries and horror respectfully. In addition, having an entire season go live on a certain date has catered to the popularity of binge watching and increased viewership dramatically. Lastly, although original content has been wildly successful, streaming titans like Disney+ still reign supreme through exclusive branded content that cannot be watched elsewhere.
Flops and Lessons Learned
With such upward momentum for streaming platforms, what causes a platform to fail in an age where streaming is in high demand?
Let's take a look at CNN+. In addition to news, CNN has developed many unique originals that appeal to its core audience. It would seem that this content could extend itself well to streaming platforms. Who doesn't want to watch classic Bourdain explore the culinary world?
So what happened? When faced with the prospect of yet another monthly subscription, the value for CNN+ just wasn't there. No one needs more news than the 24-hour news cycle provides already, and CNN originals on their own do not justify the additional monthly cost. Perhaps if CNN content was available in its parent company app, HBO Max, for a very nominal add-on, it would have seen more success.
Emily Jashinsky of The Federalist summed it up thus, "CNN is trying to be Johnny Carson in a Colbert world. The outlet is failing miserably to fulfill that goal, which is outdated anyway. It's just a terrible business model, and even worse when you try to transfer it onto a new streaming platform with massive amounts of overhead."
So what can we take away from this lesson? Brand analysis is just as important as a recognizable label alongside delivering content that's unique, exclusive, and worth the hassle of a subscription fee.
One thing is certain, we have not seen the end of new streaming platforms. But which ones succeed in the ever cluttered market is still very much to be determined.
We could talk about streaming video all day! Contact us if you want to know more about how consumers think about your service and why.
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