It’s been a busy and transformative year in the streaming world. From the writers and actors strikes to the Disney vs. Charter battle, everyone felt the effects – good and bad – of changes happening in the streaming and television industry as a whole. From live streaming to Subscription Video On Demand (SVOD), Advertising Video On Demand (AVOD), and, most importantly, Free Ad-supported Streaming TV (FAST), we’re witnessing the growth and transformation of the industry.
Check out these numbers:
The global live-streaming market grew from $1.24 billion in 2022 to $1.49 billion in 2023 at an annual growth rate of 20.6% and is expected to grow to $3.21 billion in 2027 at a CAGR of 21.2%.
The global AVOD revenue is expected to experience a significant surge in the upcoming years, projected to exceed $ 69 billion by 2029. The US will continue to be at the forefront of the AVOD landscape, with an estimated revenue surpassing $21 billion by 2029.
The FAST market is poised for substantial growth, projected to increase 13.2% from 2023 to 2027. This surge in growth is expected to culminate in a market volume of an impressive US$11.83 billion by 2027.
Let's dive more into the current trends and innovations causing ripples in the streaming world – we’ll explain what they mean for content owners (time to prioritize original, high-quality content creation!), FAST services (continuous innovation is a must) and advertisers (maximizing revenue and creativity is key).
The top 5 streaming industry trends right now
1. Rapid proliferation of CTV accelerating streaming usage Connected TV, known as CTV (for example, your Samsung TV Plus) continues to see a surge in popularity across the globe. Activate Technology and Media Outlook 2023 report predicts that almost all US households will have a CTV by 2026.
CTV, powered by the internet, offers a superior viewing experience compared to cable/traditional TV counterparts. Another reason for their popularity? They come preloaded with their own native FAST app, with over 300+ channels which consumers find compelling and engaging to watch.
2. Innovation in ad tech with generative Artificial Intelligence (AI)
AI AI is revolutionizing CTV advertising. Two key types of artificial intelligence include traditional and generative. While traditional AI is all about deciphering and understanding the underlying data trends, generative AI helps create content based on existing data points. Let’s dive deeper.
Traditional AI relies on predefined rules and structured data to execute specific tasks or solve problems, using algorithms and data leading to informed decision-making and task execution. Generative AI, on the other hand, employs deep learning and neural networks to create authentic content, including images, text and music. This capability allows it to generate sophisticated outputs that closely resemble human creativity. AI enables advertisers to grasp viewers' perspectives, empowering them to create tailored content that resonates with audience preferences and, in turn, boosts revenue generation. Advertisers are harnessing the power of AI to streamline the creation of CTV-ready ads with the simplicity of text input. AI algorithms empower marketers to refine ads by generating multiple versions and experimenting with color, clothing, and volume. This experimentation helps pinpoint the most impactful combinations. Brands such as Roku, Disney, YouTube, and Amazon are actively embracing AI tools for ad creation, and more will soon follow suit.
QR codes According to a consumer survey from our latest Global FAST report, an overwhelming 80% of our survey participants indicated that they tend to ignore ads by diverting their attention to their phones, muting their TV sets, or briefly stepping away.
CTV, on the other hand, is increasingly becoming more interactive and effective. Take the wide use of QR codes. More and more brands use QR codes in their CTV ads to allow viewers to interact with the brand directly. These codes serve as a direct point of contact between the viewer and the brand website/product details/apps. QR codes placed strategically, such as in the lower left corner of video content, can be a powerful tool for driving sales and achieving various marketing objectives.
Recent examples of QR codes in action: Rocket Mortgage:Rocket Mortgage’s ‘Barbie Dream House’ Super Bowl ad cleverly positioned a Stock X print QR code on one of the actor's T-shirts.
Coinbase: Similarly, one of Coinbase’s most notable ads was a 60-second Super Bowl spot with a QR code bouncing and changing colors. Its popularity and intrigue caused the Coinbase website to crash.
A recent survey shows that approximately 95% of consumers know how to scan QR codes, and half are inclined to scan QR codes when presented in relevant and engaging ads.
Ultimately, QR codes play a pivotal role in making television advertising more trackable by driving lower funnel activities such as generating leads and boosting e-commerce sales.
3. FAST filling the content void caused by guild strikes AI recently made news for another reason. This year, SAG-AFTRA and the Writers Guild of America (WGA) launched concurrent strikes (the WGA strike has ended while SAG-AFTRA is ongoing) due to disputes with the AMPTP regarding AI-related job threats, working conditions, and compensation.
FAST services, known for offering a variety of deep library content without requiring a subscription fee, became well-positioned to step in and address the content void created by the strikes. Here's how:
Content availability: FAST platforms can swiftly acquire and curate content not affected by a strike, such as unscripted content, news programs, sports events, and existing library content – and make it readily available to viewers.
Rob Caruso, Product Manager, UX at Google TV, shared his insight at Amagi’s LA FAST 2023 conference: “FAST has introduced a whole new set of challenges/opportunities with respect to content discovery,” Caruso said. “The in-detail metadata availability in FAST and its preciseness is something we didn’t necessarily anticipate from the early days. So, that’s an area I think will be the area to lean into to make it a personalized experience.”
Viewer engagement: With traditional content on hold, audiences may be more inclined to explore alternative options like FAST platforms. This increased viewer engagement can help FAST services attract new users who are seeking different types of entertainment during the strike.
Advertising opportunities: The influx of viewers to FAST platforms allows advertisers to reach a larger and potentially more diverse audience. Advertisers can maximize their reach and impact with more eyeballs on their content.
4. Pay TV diversifying with streaming bundles The 11-day legal dispute between Charter Communications and Disney in early September highlighted the enduring influence of traditional broadcast networks. While streaming services have rapidly gained popularity and disrupted the media landscape, they still find themselves intricately connected to the world of traditional broadcasting. And streaming costs are not getting cheaper for subscribers.
Two key things that came out of this historic agreement. First, this marked the beginning of a cable company offering a streaming bundle to its subscribers. (e.g. Disney+ Basic ad-supported offering will be provided to customers who purchase the Spectrum TV Select package). Second, it marked a crucial turning point in the cable industry, contending with waning authority and intensified rivalry from the expanding streaming domain. Although this fresh bundle may not entirely salvage the cable industry, it does introduce a noteworthy degree of convenience for the remaining cable subscribers, positioning the partnership as a saving grace for the ever-evolving cable landscape.
5. Livestream shopping on the cusp of breakout Originating in China on social media platforms, livestream shopping, which transforms shopping into an interactive experience, has since evolved into a giant $512 billion market, per Coresight Research. Major retailers like Amazon, eBay, Walmart, and Nike – and small businesses – connect with customers in real time on social media and third-party platforms, driving significant sales growth. The US livestream shopping market alone is projected to grow to $32B by the end of 2023 and is poised to more than double by 2026, reaching $68 billion. We can expect it to start making waves in other parts of the world as well.
This past year, broadcasting and streaming industry trends continued to redefine the market, signaling a dynamic future for entertainment worldwide. Be a part of this exciting future by capitalizing on FAST opportunities! Get in touch with us.