As a highly consumer-oriented industry, the sands are constantly shifting in the broadcasting and media space. Just before the pandemic, traditional TV viewership fell to its lowest since the industrial era, but come March 2020, content consumption across platforms and devices has steadily grown.
However, the devil is in the details, and we have been extremely mindful of this aspect as we make these predictions for the year ahead and beyond.
For example, even as content consumption rose in 2020, several households have also cut the cord, preferring to move instead to mobile viewership or consuming content across platforms via CTV. Hence, a simple move to produce more content will not be valuable. We must also consider our audience cohorts thoroughly and make streaming investments that cater to their specific needs.
At Amagi, we believe these are the five trends that will be driving the future of broadcast and streaming.
Broadcast will move to the cloud
Sometimes, it is hard to imagine that just a decade ago, we consumed content in a linear format, primarily driven by traditional broadcast and cable TV channels and partly by video streaming platforms like YouTube.
Today, we live in a multi-screen era where audiences worldwide are consuming any content they want at any time via a multitude of devices including cable, satellite, IP-connected devices, and streaming platforms. This is speeding up the shift to the cloud. Broadcasters are increasingly moving their on-prem, Capex-driven, backend operations to cloud-based and software-rich, virtualized environments that are Opex-driven and can be remotely operated from anywhere in the world.
Broadcasters worldwide are beginning to enjoy better flexibility, greater efficiency, better resource utilization, and overall cost-effectiveness by leveraging unified broadcast workflows on cloud.
There is increased recognition for the fact that cloud playout has democratized content distribution, and empowered content creators to maximize content ROI through strategic monetization opportunities. Cloud has led to drastic reduction in the time taken to launch a channel. What used to take 3-4 months is now achieved within hours. What’s more, with cloud broadcasters are able to run multiple channels parallelly.
Broadcasters clearly understand that to stay relevant to the times, they need better and broader reach across cord cutters and digital natives. Gen Z is now a huge audience cohort in itself, and this digitally native generation expects seamless viewing experiences. Moving to the cloud will help broadcasters reach out to them and satiate their evolving content needs across new digital platforms and the connected TV.
Advertising driven OTT models will drive growth in the industry
Real television ad dollars are beginning to move into CTV powered destinations worldwide. Ad-supported video-on-demand, or AVOD, is one of many ways by which advertisers are able to reach their target groups in the right context, and with the right message.
Currently, CTV penetration is higher in the United States, but other geographies are catching up soon, and the selling price of CTVs is falling rapidly giving more users access to this device. As the penetration of CTV continues to grow rapidly in 2022 and beyond, more content consumers will move to on-demand video platforms because of the sheer diversity of content offered here.
Where the audience is, ad dollars are sure to follow. In 2022, we expect to see major shifts in ad dollars from traditional, linear channels to ad-supported VOD platforms.
This trend, in turn, will also spur the rapid growth of Free Ad Supported Streaming TV (FAST). Consumers coming to FAST platforms expect advertisements as part of their consumption, and several players are competing already to bring them the kind of content they’d love to watch.
Therefore, several prominent FAST players like Peacock, Pluto TV, Samsung TV Plus and The Roku Channel are on an acquisition spree, roping in new content creators and creating niches every day. Anyone looking to join this ‘new linear TV universe’ needs to be extremely sure of their unique positioning and build large moats around it to protect their interests and thrive in a FAST world.
Ad-supported on demand video consumption is evolving very quickly to keep up with consumer demand. Come 2022, we expect to see major shifts in where ad dollars are spent - and that means a move from traditional TV to CTV and ad-supported VOD platforms.
Live programming will drive new user adoption
Nothing beats the joy of catching a live event. Plus, it is expected that subsequent waves of the pandemic are yet to come. The only way to enjoy a live event then is to watch it in UHD at home- a trend that will continue in 2022 despite the world opening up and better vaccination rates.
Cloud is now fully ready to handle large volumes of live programming in both the sports ecosystem as well as news delivery. Specifically, remote content production and distribution with low latencies are possible today, which means that the audience gets to experience live content as close to its original timestamp as possible.
With its innate scalability and versatility, cloud is transforming the heart of live broadcast operations: the Master Control Room (MCR). By taking MCR to the cloud, broadcasters are enjoying increasing operational flexibility and the agility to launch and run live channels.
Moreover, cloud support ensures that initial investment in expensive hardware typically needed for live programming is a thing of the past. Today, live content producers and broadcasters can benefit from easy access to cloud infrastructure, reducing the barrier to adoption.
Live sports and news channels will drive new user adoption, and broadcasters will benefit from lower barriers to cloud migration including reduced costs. Retention, however, will depend entirely on the viewing experience as more sports channels move to OTT environments.
The riches will be in the niches
Niche content creation is not just about producing enough but producing enough of the right kind of content. For up-and-coming media companies and digital firsts, investments in niche content will become a powerful differentiator going forward. Consider Horse & Country that’s dedicated to equestrian sports, Dog TV streaming service for dogs, Tastemade – the TV network focused on food and travel or Fuse Beat – the Black culture channel and Elvis Presley channel - comprising the music legend’s archival content and specials. These are just a few examples from the plethora of channels and networks offering micro-niche content catering to audiences’ specialized interests.
Today, we’re also seeing a rapid proliferation in the number of destinations audiences can head to in order to consume content. Even content around the same niche or genre is spread across multiple streaming services and devices.
Going forward, cross-channel fatigue might give niche content holders an opportunity to build consumer loyalty. As they study their audience behavior and curate more content to meet their needs, streaming platforms will earn the coveted loyalty of an audience - a huge differentiator in such a rapidly evolving space.
How they think of these niches today has the potential to shape the next decade of growth. We now have an opportunity to go beyond known and accepted niches and into areas catering to food lovers, music fans, dog lovers, and every other niche in between. There are also demographic niches such as a Latin/Hispanic audience, an audience looking for K-Drama, an audience for music icons, and so on.
So, what must a broadcaster do? The best bet in 2022 is to identify a behavior-based niche that makes sense to the current audience cohort and offers growth potential, and to go after content creators in this niche. Over time, this differentiator can help cater to a highly loyal audience base, which in turn can power sustainable growth.
Content creators can benefit immensely by niching down on their audience and producing quality content for a select group. As the noise of content grows, people will begin to demonstrate their unique preferences more clearly.
Every decision in the streaming ecosystem will be powered by data
Data-driven decisions have been the norm in some industries, and just a buzzword in some others so far. Specific to the broadcast and streaming industry, there is immense scope for using audience behavior and consumption patterns to determine everything from what kind of content to produce, to advertising, and the specifics of ad load and frequency of ad breaks.
Using key data such as viewership minutes, unique users and average viewing sessions, and combining this with a rich content metadata, can give content owners and advertisers alike more opportunities to:
With powerful and well-integrated content and ad analytics technology, content owners and streaming services will be able to make more well-informed decisions and ace their business strategies.
Comprehensive viewership and ad analytics will drive more granular and strategic decision-making by content owners, streaming platforms and advertisers. As a result, we will witness increased personalization of content and advertising, and better user experiences, eventually boosting revenues and audience loyalty.
Thrive with Amagi
These are exciting times to be a part of the broadcast and streaming industry for everyone from broadcasters, content owners and aggregators to advertisers and even audiences. For media SaaS partners like Amagi, the emerging and entrenched trends provide us immense opportunities to drive tech innovation that enable greater business agility. Team Amagi looks forward to help you ride the waves of change and maximize your content ROI - with our end-to-end cloud solutions for linear channel creation, distribution and monetization.
To start the new year by embracing Cloud or by venturing into the new linear TV universe (FAST), reach out to us at email@example.com