The Streaming Wars – Return of the Aggregators

One of the fun parts of my current role as CMO at The Weather Group is it affords me a seat at the front line of the most contentious battle in the history of the media business – the race for market share in streaming television.

If you’re in media or marketing you are bombarded daily with predictions and updates from the so-called “streaming wars.”  And while I find that these types of media business/inside baseball type of posts are less popular with my readers (probably because they hear enough about it elsewhere), I will from time to time share my observations.  Hopefully it doesn’t bore you too much…

Return of the Aggregators

History repeats itself in media.  The scale and speed of change in the business today is head-spinning, but the underlying trends are not unique.  Creativity is unleashed when technology lowers barriers to producing and distributing content.  The growth of the cable business in the ‘70s and ‘80s fueled the launch of dozens of new networks and hundreds, if not thousands, of new shows. 

Today, thanks to technology it’s easier and cheaper than ever to create a television network.  The number of new FAST channels (free ad support streaming television) that have launched in the past few years is dizzying.  Not to mention the well-chronicled explosion of premium subscription content.  And thanks to the Internet everyone can be a distributor.  No longer do you need permission from a few gatekeepers to market your content.

But in 2022 there is too much choice, too many channels.   The biggest problem facing content providers is discoverability.  Watching streaming TV is the same lean back experience as watching traditional TV (broadcast/cable/satellite).  However, the data indicates that viewers don’t channel surf the same way on Roku or Amazon Fire as they do with a cable remote.

Unless you’re one of the players with strong brand awareness (i.e, YouTube, Netflix, Disney+, HBO Max) it has become exponentially harder in the past 12-24 months alone to get consumers’ attention. Not all the channels are going to make it.

As I alluded to previously, the answer lies in the past.  The industry will lean into two time-tested value propositions:  simplicity and affordability.

The much-maligned cable bundle is one of the great product innovations in media history.  Simplify consumer choice by packaging a wide array of channel options at an affordable price.  It worked for decades until the costs of sports rights rose too quickly and priced millions out of the market.

But the formula remains unbeatable.  Packaging content will be more important in 2022 than increasing the supply.  There are already way more than people can ever find or consume.  That doesn’t mean production will stop.  Quite the contrary.  But the smart money will follow those who figure out how to forge the right partnerships with other content providers and distributors to make their offerings easier to find and purchase.

While this will only increase the market power of the leading streaming platforms like Roku and Amazon, ironically it also will strengthen the hand of the traditional distributors who have taken a beating recently – cable/broadband, satellite, and wireless telecommunications providers.  The traditional broadband companies in particular – Comcast, Charter, Altice, etc. – are in a strong position.  Cord cutting is a misnomer, they are connecting more homes than ever.  The difference is fewer are opting for video.  But their broadband services are heavily fortified, the barrier for competitors remains steep, and no one understands how to package and market bundles better.

Sometimes the old adage is true – the more things change, the more they stay the same.

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