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FAST momentum drives the booming streaming market

September 12, 2023 | By Rande Price, Research VP – DCN

The streaming revolution is reshaping content consumption at a rapid speed. comScore’s State of Streaming 2023 reveals a 21% surge in the number of hours households watch connected TV (CTV). This increase translates to an additional 2 billion hours in 2023 compared to the previous year. Total hours viewed grew from 9.6 billion to 11.5 billion from May 2022 to May 2023.

Ad-supported services, which claim the largest part of the newfound viewing audience, are driving this growth. The data underscores the shift towards digital streaming as millions of households’ primary content consumption mode.

The overall growth in streaming consumption is quite impressive. However, the most game-changing statistic highlighted in the report is that 75% of the newly acquired streaming hours are from providers beyond the top six streaming apps. This elite group includes Netflix, YouTube, Prime Video, Hulu, HBO Max (now Max), and Disney+ is witnessing an interesting transformation. As the consumption of FAST (Free Ad-Supported Television) and targeted programming intensifies, these traditional giants face competition from rising stars in the streaming realm. FAST’s expanding influence is reshaping the streaming landscape.

Key trends in the streaming market

comScore’s report explores and confirms trends in the streaming landscape, adoption, growth trajectories, and the ever-evolving range of services.

Digital video acceleration: Digital video consumption is accelerating, with 81% of households with WiFi engaging in streaming content.

Ad-supported streaming growth: CTV households streaming ad-supported content now reach an impressive 83.7 million, a 17% increase from 2021 to 2023. Non-ad-supported services also showcase growth, reaching 81.1 million, reflecting a 9% increase.

Targeted programming triumph: Targeted programming on FAST platforms is surging. Hispanic households lead the charge by consuming nearly twice as many hours of FAST content, showcasing an impressive 81% YoY increase. Linear streaming providers also found their place in the digital realm, securing three top spots in the Top 10 video services based on hours viewed per household.

Cord-cutting dominance: The cord-cutting trend is reaching a new milestone, with 60% of CTV households now being cordless. This substantial leap from the 37% recorded in May 2019 underlines the growing shift away from traditional TV subscriptions.

Smart TVs reign: Smart TVs are firmly establishing themselves as the preferred device for CTV streaming, with a robust 23% increase in total households streaming content via these devices since May 2021. Gaming consoles are also seeing a notable 18% increase in usage for streaming purposes.

Real-time market impact at play

Further, comScore’s report provides context in understanding how the evolving TV streaming marketplace impacts the current television revenue model. The current Charter-Disney dispute centers on pressure to change the existing television distribution paradigm. Charter is declining to accept Disney’s requested fees for its channels, citing the fact that Disney primarily reserves its premium content for its streaming platforms. Charter wants complimentary access and distribution flexibility, which directly impacts Disney’s direct-to-consumer revenue strategy. This dispute underscores the rapidly shifting dynamics of the entertainment industry.

The State of Streaming showcases the ongoing revolution of streaming in the entertainment landscape. With consumption growth, the ascent of ad-supported services, and the proliferation of emerging players, the report provides valuable insights to help reshape content monetization strategies.

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