How Streaming Services are Damaging the TV Market
| Reuben Howe
It's no secret that the majority of content produced and watched is now available online. While some of us forget that for it to end up online it usually starts out on Live TV first, there are those who are recognising the underlying effects of this huge wave of content.
For streaming services to deliver this avalanche of content in a meaningful way, it had to be broken down into parts. This has even led to some streaming services creating pre-set "EPG" style screens to convince users to watch "what's on" instead of browsing for hours without committing.
It's a cycle of content delivery, but how bad is the situation really?
Total Number of Streaming Services Surpasses 3,000
In a study by the research collective Omdia, they counted over 3,700 streaming services worldwide.
That's 3,700 different apps or websites that supply catch-up or on-demand content.
I thought needing Netflix, Amazon Prime and Disney+ all at once was bad, but that's only 3! Add in iPlayer and U for UK catch-up and that's 5, I suppose...
Only 3,695 to go...
Pass The Parcel of Content
There comes a point of saturation, where streaming services simply have all the content they can possibly have, collectively. This means the services wouldn't be able to offer anything "new" on their homepages, and the services would stagnate.
This is how we end up with the ridiculous game of pass-the-parcel which these services play.
One month Netflix will have a film, only to palm it off on to Prime the next to make room for something else.
The content hasn't changed, it's just offered somewhere else now (And importantly, potentially for a different price!)
All these services are "fighting" for content, except it isn't a fight, because they're all incredibly aware how inter-dependent this system is. It's an Ouroboros of content.
If content isn't continuously switched-out, each service would miss out on marketing the content as "new".
Deliberately Confusing Content Layouts
You've heard of a "monopoly", where one provider dominates a market. However, one tactic that is increasingly popular is the "confuse-opoly".
Essentially streaming services have so much content spread out in such an arbitrary and confusing way that people think "I'll just get everything then I know I'm sorted".
Working out what content comes with what is such a chore, especially when that content could change provider. Getting all the services available is a strategy a lot of customers opt for.
There's no way to work out which streaming service is the best value, or worth the most, because the landscape is deliberately changing constantly.
An Example: Watching Pokémon
To demonstrate how arbitrary and confusing the system actually is, for those who don't know, let's look at an official guide on how to watch Pokémon:
https://www.pokemon.com/uk/animation/where-to-watch-pokemon-episodes-movies
This is the official Pokémon site, and it breaks down exactly where each series and movie of Pokémon can be watched.
This covers NINE different platforms:
- 6 platforms are streaming or on-demand
- 3 are purchasing platforms to buy or rent individual episodes / movies
It doesn't end there.
The shows and movies are grouped by provider, not chronologically. So, if you wanted to watch in order you couldn't simply start at the top and work your way down.
In fact, the first service, BBC iPlayer, has Season's 14 onwards, but then Netflix has both Season 1 and Season 23 - 25, which means you need to bounce between the two.
Prime Video has some of the seasons in that gap between 1 and 14, but Sky Kids is the only place listing many of the middle seasons.
This is just one example of a franchise being split across services. The same is true for franchises such as Spider-Man, SAW and many, many more.
TV Prices Affected By Streaming
The final change to the TV market I will highlight is the actual price of the units. You might think that Smart TV's are sold at a premium in order to capitalise on the access to this huge range of streaming services, but actually you'd be wrong.
In the case of two brands, Vizio and Roku, TV units are actually sold at "almost zero margin".
The hardware isn't what's making the money, they know it's the services and online access.
So, they lower the hardware price as much as possible to get people using the TV, then once the user has the TV they can get sucked into online subscriptions, adverts and data costs.
This could be a positive, in that advanced hardware actually becomes more affordable for the user at base-cost. The question then becomes, why do they feel so comfortable lowering that price?
If the customer wasn't spending more in the long run, there's no way this would be viable marketing.
For those customers who take advantage of the low price hardware and then resist splashing out on subscriptions, they have only benefited.
However, because of confusopoly, that's not the reality.
The reality is we save £100 on a new TV, just to spend that in the first 6 months of subscriptions...
Streaming and TV Are Here to Stay
Whether you buy-in to the online-only subscription-based TV services or not, there's no denying they are having an effect on the market. Even if all you want is Live aerial TV, the internet is playing a bigger and bigger role in that.
On the plus side, you can get that TV unit a little cheaper thanks to the monetisation of the online services, so if you're smart you can save yourself a good few quid.
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