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There’s probably not another single sector that is as disrupted right now as media. While the battle for time and attention hots up, the next big advance could come with personalizing choices and cutting through the noise.
Evolving customer expectations, fueled by new technology, and disruptive brands built on non-traditional business models are wreaking havoc in the media arena. The last time we saw a strong show of traditional media brands on the Best Global Brands ranking was in 2016, when Disney, MTV, Thompson Reuters and Discovery were all ranked. Fast forward to 2019 and Disney is the top ranked traditional media brand in the 2019 Best Global Brands at #10. Discovery still makes the list but it’s declining (#91 vs #81 YOY) and the rest have disappeared. What has replaced them is a slew of new competitors, most of whom wouldn’t have been considered media brands very recently, and who are now upping the ante with increasingly aggressive pricing and competitive models. The key players in 2019 are Netflix, the second-fastest media brand mover with a rank of #65, and Apple and Amazon, with #1 and #2 spots on the grid overall and deep, deep pockets.
Within this fast-evolving and volatile landscape the very nature of what constitutes media is shifting. No longer is the argument around print vs digital; snackable content vs depth or quality; Cable vs OTT; TVOD vs gaming. Instead media companies, the producers and distributors of content, are fighting for consumers’ most valuable commodities – time and attention. A category that has long trained consumers to pay for and access only what they want has left consumers tied to multiple services.
With cord-cutting and churn being routine, ‘subscription fatigue’ is a new frustration that is leading to a new and even more worrying consumer behavior: cord burning. Moreover, newly formed customer expectations of unlimited access to content has started to trickle out to other media areas. Kicked off by Movie Pass, theaters are branching into subscription services to counteract the booming online streaming options. As consumers have become more accustomed to nearly limitless options for viewing, these passes are aiming to match and cater to this new behavior.
And it’s spreading into hitherto untouched areas of the media ecosystem. While TV, movies, music, and gaming have generated the most revenue and growth in this space, some reports also expect about 20 million digital-only news subscriptions worldwide by the end of 2019.
CONSUMERS ARE UTILIZING DIFFERENT PLATFORMS IN DIFFERENT MOMENTS, FOR DIFFERENT PURPOSES
The demand for more content has been replaced with desire for right-for-me content, with the average household in the US subscribing to anywhere from 3-5 streaming services; adults in developed countries globally have at least 5 subscriptions per person and this is expected to reach 10 by the year 2020. But consumers across all demographics are more than 30% likely to cancel a subscription streaming service after the show or series they are watching has ended. Smart devices offered the promise of aggregated content. But the promise hasn’t fully articulated yet. iTunes – the service that (legally) transformed the music, film, digital publishing and podcast industries for 18 years, died a moderately quiet death in May. It marked the end of paying for content piece by piece – and gave concessions to the subscription economy, championed through platforms including Spotify (which reached the 100 million paid subscriber threshold in April – compared to Apple’s 50 million). Flipboard has been downloaded over 500 million times and has over 145 million monthly users. Every month, Google News (aggregator) and Google Search drive over 10 billion clicks to publishers’ websites. Google News has 150 million monthly US visitors; double the number of CNN and the NYT. It’s estimated that Google made $4.7bn for news double the number of CNN and the NYT.
It’s estimated that Google made $4.7bn for news sites in 2018 (just $400m less than the United States news industry as a whole brought in through digital advertising last year). And in this context the most traditional form of media, the print magazine, has evolved from a fast read to a slow read. Reading physical print media has become a relaxing and indulgent downtime activity. We go to print for depth, quality and immersion. So for consumers there’s no ‘one size fits all’ option…
THE ATTENTION ECONOMY
As content creators, from the artists at Pixar to the designers at Epic Games, fight for our attention, consumers are beginning to find the abundance stressful. The brand which owns the winning customer interface will have the advantage in owning the relationship with the viewer. Does the cable or satellite provider own the access, the smart TV, the voice-controlled device like Alexa, the wireless provider, the hardware ecosystem? With 5G heralding an era of devices connected wirelessly and delivering fiber optic download speeds, will we need an internet provider in our homes as the gateway to OTT services?
Voice is certainly the newest and fastestgrowing interface behind the traditional touch method for accessing content. Remotes for cable and satellite providers, hardware brands with built in voice devices, and in-home personal assistants are the most utilized for this technology. If voice leads, then recall for brands and shows is increasingly important.
No more browsing the channel list looking for something to watch; it’s what you know and have seen elsewhere that will take you direct to the content or channel that you want. With more predictive analytics on the horizon, even those viewers who do enjoy browsing will have more personalized suggestions without the endless scrolling.
SO WHAT’S THE VERDICT?
As the media wars heat up, it remains to be seen whether consumers have the patience, or money to navigate these fragmenting services. Winning through original content, will prove costly; we expect more than a few casualties. In becoming the platform of choice, relying less on original content seems like the smartest move. The cord burners already seem to be proving that original content isn’t enough to stop the churn and it’ll be difficult to compete with the deep pockets of the newer players or Disney’s back catalogue.
So all of this increased competition begs one question: where will innovation point next?
We believe that curation and discovery will be the lever that helps the winning media business leap ahead of customer expectation and re-set loyalty across the arena.
The winner will be the business that can cut through the noise to understand how people really iew their downtime.