Video streaming is getting hot as competition for subscribers among big plays heats up, challenging Netflix‘s dominance in a market it pioneered.
The video streaming market is changing, in several ways, providing an opening for Netflix’s competitors to invade its market turf. One is content diversification, offering additional material like news and sports to keep subscribers’ eyes on streaming devices for longer hours.
“We saw Disney+ overtake Netflix in subscriber numbers earlier this year, which shows Netflix cannot be complacent when it comes to Amazon and Apple,” said Stefan Lederer, the CEO and Founder of Bitmovin, a multimedia technology company, in an email to International Business Times. “Especially because both companies have more diverse revenue streams.”
Chris Legg, Senior Managing Director at Progress Partners, is of a similar opinion.
“We’ve seen Amazon and Apple begin to diversify their content, even moving into the sports category – Amazon with Thursday Night Football and Apple with MLS and MLB,” he said.
Joshua Otten, CEO of Ronin, the largest privately owned live-streaming network in the U.S., explained why Apple and Amazon are a serious threat to Netflix’s dominance.
“Apple and Amazon can afford to take risks on IP and spend more money on content in the long run,” he told IBT. “While Netflix may be forced to invest in volume, spectate, and reality/docuseries (which can increase retention. But in the long run, it won’t translate to movies, theme parks, or ancillary revenue streams via video games and virtual experiences).”
Another way streaming is changing is the shift from quality over quantity, the offering of new award-winning movies that entice and retain new subscribers.
Again, Disney, the owner of studios and a long history in making movies, holds the edge in this area.
But Sean Boelman, a TV and film expert and writer at FandomWire, sees Amazon being a good candidate, too.
“Amazon’s acquisition of MGM earlier this year gives them a wealth of original and library content for their Prime Video service,” he told IBT. “Prime Video’s potential success is just a matter of convincing people to use the service — many consumers already subscribe to Amazon Prime for their shopping needs, and the streaming service is already included.”
Boelman is optimistic about Apple, too.
“Apple TV+ is one of the more exciting underdogs in the streaming wars,” he said. “Like Prime Video, many consumers have access to the service because an extended free trial of several months is offered with any new Apple device purchase. Apple TV+ also has some of the best original content in the game, with many of their most popular shows winning several awards — although they need to invest in a back catalog of library content to retain subscribers.”
A third change in the streaming market is bundling, the packaging of movies with other services like games, music, and eBooks, which helps retain and expand the subscriber base.
That’s an area where Disney+ does exceptionally well, according to Lederer. “Its recent bundle with Hulu and ESPN helped diversify its content, making it far more attractive to new customers who may not have seen as much value in the previous Disney+ content,” he said.
However, Netflix is taken steps to grow its bundle offerings by acquiring Spry Fox, doubling down on its efforts to expand into the gaming space.
“It will be exciting to see how bundling becomes central to streaming services’ subscriber growth strategy in the coming months,” Lederer added.