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30 June 2022
The video market will end in tiers
TV & Connected TV planning & buying
As the video market enters a new period of hybrid models, many SVOD and BVOD services are moving to both ad-free and ad-supported tiers, a development that brings a fresh set of challenges for both broadcasters and advertisers, says a new report from Kantar.
The Future Viewing Experience appraises the near-term future of the TV and video landscape in which the smart TV set has become the primary driver of increased usage of connected streaming services.
Why it matters
For media owners, the era of set-top boxes is coming to an end and the battle is now on for control of the main video delivery gateway into the home: the connected TV screen itself.
Brands, meanwhile, are facing the prospect of a two-tier advertising ecosystem in which those who can afford ad-free environments may become ever harder to reach.
Significant steps towards vertical integration will define the long-term as global media owners seek to control the entire chain, from production of content to delivery into the home. The trend could signify a slowdown in content availability.
Media companies are seeking a return on their significant investments in intellectual property by promoting franchises and capitalising on global and local fanbases. The internationalisation of culture and younger audiences’ love of sub-titles is ushering in an era in which local content can go global.
Critical mass for a global service will be beyond all but a handful of players with valuable and extensive intellectual property. Independent production will remain significant with smaller and niche players finding value in collaborating with others to compete effectively.
Streaming services are taking a more broadcaster-inspired sequential release approach to flagship originals, so helping drive buzz and prolong subscriptions. There will be less box-set bingeing in future.
If the complexity of the video distribution ecosystem can be effectively tackled, Smart TVs can enable true addressability, offering transformative opportunities and facilitating new forms of advertising.