Aug. 18, 2023

Binge-worthy Streaming Service to Your Home

The streaming industry has undergone a significant transformation in the past decade. The rise of streaming services has posed a serious threat to the long-established cable TV industry. With more people cutting the cord, more players are entering the streaming space. We’ll analyse the streaming industry’s evolution, current trends, and prospects.

In 2005, Netflix started to provide ‘on-demand’ TV or video streaming services. As the name suggests, the biggest factor distinguishing the streaming services from linear TV is the freedom to watch at your convenience. This rapid rise in streaming means that people have the ability to watch on any screen—mobile, laptop, or TV—and have a personalised experience. While the benefits of streaming are numerous, the spread of streaming wouldn’t have been possible without the required ecosystem. Fast and reliable internet connections have made the rapid growth of streaming a reality. At the same time, the spread of smartphones and other devices is playing a key role in the development of the streaming industry.

Nowadays, there are various streaming options currently available to viewers. Streaming service providers and multichannel video programming distributors (MVPDs) are both competitors and partners. MVPDs stand to lose as subscribers move to streaming providers like Netflix. However, MVPDs also offer their own streaming services like Dish Network’s Sling TV and AT&T’s DirecTV Now.

Global Streaming Market

According to Fortune Business Insights, the global video streaming market size was valued at USD 455.45 billion in 2022 and is projected to grow from USD 554.33 billion in 2023 to USD 1,902.68 billion by 2030, exhibiting a CAGR of 19.3% during the forecast period. The rise of ad-supported tiers on Netflix and Disney+ is expected to continue in 2023.

With more people cutting cords and opting for personalised experiences, it is clear that streaming services will continue to grow in popularity. The future of cable TV remains uncertain as more players enter the market and offer their own streaming services.

As of April 2023, the number of over-the-top (OTT) video users worldwide stood at around 3.5 billion. According to the same source, the countries with the highest penetration rates of OTT video users in 2023 are the United Kingdom, Canada, and the United States. Unfortunately, I couldn’t find a list of countries with the highest number of video streamers.

Streaming Dollar

Streaming services make money primarily through subscriptions. Netflix, for example, operates a subscription streaming service offering a wide range of licensed and original entertainment programming, including movies and serials. Subscriptions are the predominant source of the company’s revenue. Streaming services are available in three tiers, with higher-cost subscriptions offering streaming to additional devices and in higher definition. Although the company operates as a single business segment, Netflix does break out its streaming revenue by four broad regions: the United States and Canada; Europe, Middle East, and Africa; Latin America; and Asia-Pacific.

In addition to subscriptions, streaming services also make money through advertising. Ad-supported tiers on Netflix and Disney+ are expected to continue in 2023. Streaming services will work with businesses, brands, and advertisers so that those streaming companies serve their ads to the non-paying audience. A portion of the ad dollars may go to the creators, while the other part will go to the streaming platform.

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