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How differentiation and education will shape the next phase of streaming

March 29, 2022 | By Rande Price, Research VP – DCN

Video is exploding, and new services and platforms are popping up right and left. From broad TV platforms categories like SVOD. FAST, and vMVPD, the wide range of products and offerings can be confusing. The two biggest areas to address are viewing choice, which is about deciding what to watch (the content), and where to watch (the platform).

With series distribution deals, syndication rights, and talent deals, it’s hard for viewers to know what shows are on which platform and where to find what they want to watch. However, it is clear that content drives subscriptions with over more than one-third of viewers (36%) signing up for a service to watch a specific show/movie in the past year according to new report from HUB Entertainment Research.

Acronym soup

Consumers and professionals alike are confused about the proliferation of acronyms such as:

  • SVOD: subscription video on demand service that users must subscribe to access (i.e., Netflix) content.
  • FAST: a free, ad-supported streaming TV services like a Roku’s Roku Channel or Paramount’s Pluto TV.
  • vMVPD: a virtual multichannel video programming distributor. It offers aggregate live and on-demand TV and delivers the content over the internet. vMVPD services resemble the familiar cable line-up and packages like Hulu Live TV and YouTube TV.

Multiple streaming sources

HUB Entertainment Research’s Evolution of Video Branding report confirms that consumers are unclear about platform offerings. For the report, HUB surveyed 1,601 US broadband consumers aged 16-74 who watched at least 1 hour of TV per week in February 2022.

According to HUB, viewers use 5.7 TV sources compared to 3.7 before the pandemic in 2019. Numerous streaming brands like Amazon Prime Video, Apple, Disney+, HBO Max, Hulu, and Netflix are marketing to consumers around exclusive content deals.

Disney+ and Warner Media were the first to offer theatrical releases straight to SVOD during Covid-19. Antenna Research’s analysis of Hamilton and Wonder Woman 1984, theatrical release directly to streaming, showed that roughly half of the U.S. viewers joined the service after their premieres but were gone within six months.

Awareness and differentiation

HUB’s analysis examines the ways in which streaming brands are trying to break out of the pack to attract and retain viewers. Awareness is ubiquitous among five brands – Netflix, Amazon Prime Video, Disney+, Hulu, and HBO Max. However, aside from Netflix in this top tier, two-thirds or less of respondents understand the top brand’s offerings and how they’re differentiated. Further, the next tier of streaming services presents even lower awareness and knowledge of the service.

Programming as a differentiator

Interestingly, consumers view Disney+ and ESPN as TV streaming services with strong genre focus. Their programming genre is their brand: Disney+ is synonymous with children and ESPN with sports. Interestingly, among those aware of the different services, Disney+ is viewed to have the strongest genre focus in their programming.

Options and confusion

In particular, awareness about FAST services is very low. Less than one in three of those surveyed understand what differentiates one brand from another. Consumers view FASTs services as interchangeable and impossible to tell apart from one another.

According to Nielsen, consumers had at least 200 streaming service options in mid-2021, with more to come. The Hub research identifies the consumer confusion associated with the tremendous growth of TV streaming services. Together, these services accounted for 28% of total TV usage in October 2021.

Consumers welcome guidance in identifying and understanding the value of each streaming proposition. Strong branding and points of differentiation are encouraged among services and platforms, especially FAST programmers. To fully maximize the opportunity streaming offers, the market will require increased consumer education. And streamers need to focus on what makes them unique, whether that stems from a strong genre focus, breadth of offering, affordability, usability, unique content offerings, or brand recognition alone.

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