20 STREAMING MEDIA INDUSTRY SOURCEBOOK 2018
noted that over a quarter of
all streaming is done by people under 18, while nearly
half of YouTube streaming
is by those under 18.
Mobile viewing continued
to rise in 2017, but it was still
less than living room viewing,
which became more connected than ever. Or course, plenty of people managed to enjoy
both at once. A late-year report from eMarketer said that
70.3% of U.S. adults watch TV
while surfing the net.
“With the average U.S.
adult spending more than 2
hours a day on their smartphone, as well as the popularity of VOD and over-the-top services like HBO Go
and Netflix being viewed via
connected TV, multitasking
between two or more devices continues to increase,” said eMarketer senior forecasting analyst Oscar Orozco.
More choices, more money, more time: Can it all
last? Can this balloon continue to inflate in 2018? For
that answer, let’s turn to some experts.
What to Expect in 2018
The big questions in media and entertainment these
days are how many virtual multichannel video programming distributors (vMVPDs) can the market handle, and how low will subscribers dip for the pay TV
companies? As the year ended, IDC research director
Greg Ireland was thinking about the transition from
linear to digital that we’re now undertaking, and if
this will look like a critical time—an essential pivot
point—when people in years to come will look back
at the eroding linear television market.
Interviewed at the end of 2017, Ireland had the Q3
numbers for traditional multichannel video programming distributors (MVPDs) in front of him, and they
didn’t look good. While Q3 usually shows a rebound
for pay TV after a weak Q2, this year the numbers continued to slump. Meanwhile, vMVPDs are on the rise,
with DIRECTV NOW reporting more than 1 million subscribers. Pay TV is still a much larger market, but signs
indicate we’ve reached a tipping point, and that pay
TV will continue to decline and digital to rise for many
years before we finally see them plateau.
“What I wonder is whether this really is the year
where the integrity or the viability of linear is real-
ly starting to show its cracks and whether we’ll look
back and see this transition from traditional to virtual
MVPDs as just a piece of a bigger picture of eroding
linear television,” Ireland says.
How many skinny bundles can the market bear?
Ireland says it depends on how consumers look at it.
The Catch- 22 of skinny bundles is that, while they’re
inexpensive, they offer limited choices, forcing con-
sumers to cobble together a variety of services to get
all the programs and channels they want. Pay TV cus-
tomers pay one large monthly bill and complain that
they have hundreds of channels but nothing to watch.
For skinny bundle customers the situation is different:
They’re paying a large amount every month divided
over several bills, but get far too much great content
to watch. It’s not a bad problem to have, he thinks.
“To some degree, consumers are re-allocating their
spend,” Ireland says. “I wouldn’t be surprised if, for
many consumers, they’re actually spending more
overall on video entertainment. That speaks, again,
to this golden age of content that we’re in, that there’s
so much good content that we need a lot of services
or a lot of channels in order to get access to all of that
Ireland sees a strong future for service aggregators,
with Amazon Channels being the first, which allow con-
sumers to select the services they want and then pay
for them all with one monthly bill. Aggregators take
the frustration out of juggling multiple plans. Consum-
ers feel nickel-and-dimed when they have to pay $10
here, $20 there, he says. But when they get everything
through one tidy monthly bill, they feel better about it.
Don’t look for a new, large-scale, cable-style bun-
dle to take off online. Content providers don’t want
Apple will invest $1 billion in programming, but it entered the original content competition modestly in 2017 with shows like Planet of the
Apps and Carpool Karaoke.