Are you battling the right war
for your subscribers?

Who really competes with TV operators

The streaming wars are hardly a novelty, and the competition for video services’ subscribers has only grown fiercer in the past years. Research powerhouse OMDIA reports that in the second quarter of 2021 the total number of video services worldwide grew 3.2% to 5,596, and the room keeps getting more crowded as new players join in.

Latest dispatch

How are viewers reacting to this abundance of options? In 2021, the number of TV services used by each viewer hit an all-time high at nearly six per person, double the number used in 2018. Unfortunately, the bigger picture is far less promising. More and more sources reflect how content fragmentation is driving a wave of user frustration, which is ready to turn into a tsunami. 60% of multiple streaming service subscribers expressed frustration with their viewing experiences, and churn is estimated to increase by 30% in 2022, with 150 million SVOD subscribers worldwide expected to cancel a video service.

Indeed, users are finding that video streaming is now very far from the relaxing experience it used to be, having to jump from one platform to the next and browse through never-ending catalogues. A study showed that almost half of viewers spend more than six minutes searching for something to watch – that is almost a third of the duration of an episode of your favourite sitcom.

Not all hope is lost

Pay TV operators find themselves in a privileged position to bring back a unified watching experience. They already have the right weapons at hand, and can arm themselves with tech platforms to accommodate integrations of a varying degree with different content providers. A joint Mirada-Digital TV Europe report showed 82% of respondents are considering, or already developing their own super-aggregation strategy.

Turning once foes into friends benefits the common growth of both TV operators and content providers, but the real winners are the users who are finally able to go back to comfortably accessing all their content from one hub. However, successful alliances between content providers and operators do not mean the end to the increasing tensions at the forefront of the streaming wars – if that is even the right term anymore.

The shifting battlefront

In November 2021, Netflix rolled out Netflix Games on both Android and iOS mobile devices worldwide, in a bid to expand its offering of original content to video games. Only two months before, HBO Max announced it will produce and deliver its own in-app exclusive podcasts, starting with Batman: The Audio Adventures. Both moves make perfect sense when considering that the global gaming market will amount to 268.8 billion U.S. dollars annually in 2025 (up from 178 billion U.S. dollars in 2021), while global podcast ad growth has risen from 7% in 2020 to 27% in 2021.

However, as one could expect, the SVoD giants’ expansion strategy goes beyond just jumping on high potential options because the fight for subscribers has transcended video services. As devices grow more sophisticated and become an essential part of daily habits, users worldwide are making the most of it and expanding their choice of entertainment further than ever.

A look into their screens (smartphones, tablets, smart TVs…) tells us that video streaming services are taking most of users’ time – only second to social media. The streaming war has evolved into a war for viewers’ attention, with more players than ever.

Just like it happened with the arrival of SVoD competitors, it is the moment for TV operators to catch up with their changing ecosystem to assess the new threats…and opportunities. With the number of video services (and content on offer) growing faster than ever, operators need to stand out from the crowd and enhance their subscribers’ loyalty. An aggregator strategy comes again to save the day but this time it will require operators to abandon their bundling comfort zone and, just like Netflix and HBO with video games and podcasts, embrace new ways to engage with users and differentiate from competitors with exclusive content.

The good news is that we already find operators taking the plunge out of their traditional offerings and aggregating services that span through entertainment and beyond. Music services are particularly popular: in France, Orange subscribers can add Deezer Premium to their plans, whereas Spanish Telefónica has launched Movistar Música with 50 million songs available for streaming with weekly subscription packages, and Sky offers integrated Spotify billing in the United Kingdom.

As in every other competition, winning strategies can go as far as your imagination. Before dabbling into music, Sky incorporated devices to its offering with the Sky Glass TV, and apprehensive Spaniards can also hire their private health insurance through Movistar. As long as it brings added value to subscribers, any service could form part of an aggregation strategy.

Is it too early to wish we could order our pizzas through our favourite streaming platform right as we prepare to binge-watch the latest show?

Sources: OMDIA Global Online Video Services Tracker – 4Q21, Flixed, Hub Entertainment Research, Deloitte, Accenture, 2021, Netflix, Statista 2021, Forrester, Xataka, Broadband TV News.