While the general consensus is that the video entertainment world is moving inexorably towards streaming, the progress is not linear and some of the firms involved are taking too long to fully commit, according to streaming video viewership research from telecom and media research firm LightShed Partners.
Despite the evolution of the technology and growing acceptance by the public, the category is top heavy, with a few big providers dominating. Just three services — Netflix, YouTube and Amazon Prime Video — represented 64% of time spent on streaming on connected devices in July. The three companies dominate, despite newcomers’ access to “vast libraries of content,” lower/free-with-ads pricing and cross marketing to other assets, according to the report.
The post uses Comscore assessments to profile the field. The top five services are Netflix, YouTube, Amazon Prime Video, Hulu and Disney+. There is quite a drop off to the sixth provider, HBO, whose viewership share is in the very low single digits. The top five represent “a jaw-dropping” 83%of time spent streaming.
The post offers four key takeaways:
- The sheer size of YouTube in the connected TV realm tends to be forgotten. It is bigger than Disney+ and Hulu combined and more than half-again as large as Hulu.
- The streaming world is far smaller for advertisers than the linear world. In the old paradigm, advertising was everywhere except a relatively small number of premium/pay channels. Advertising supported programming is not nearly as common in the streaming world.
- New entrants face tremendous challenges. The goal is to build habitual viewing behavior–and incumbents are leaving little opportunity.
- Netflix seems to be underpriced. This, combined with Netflix’s size, is a major challenge for new entrants.
“[W]hile new streaming services benefit from consumer adoption of streaming technology, they have all waited far too long to compete,” the analysis says. “To truly scale engagement, streaming services such as Disney+, HBO Max, Peacock, Paramount+ and others will need to spend far more than they currently want to on programming (both original and licensed), not to mention marketing and technology.”