As the world ushers towards the second half of the decade, the rise of the digital age has seen a revolution in many industries and has changed the way people view, behave and interact with the real world.
Internet-of-things (IoT) is a reality, first our phones became smarter and then TV, followed by Houses and now entire Cities are being wired up to the Internet and are becoming smart.
The fact remains, Internet is here and now, and it’s changing the human behavior and dependencies.
The rise of the digital era has seen the fall of many giants like Kodak, BlackBerry, Nokia etc who failed to move with the times and change itself. It’s seen the rise of unconventional companies entering a crowded market with an innovative “smarter” product and taking over the entire industry, and it has only shown that we have got to move with the times and adapt ourselves to maintain market dominance and to understand changing user trends.
The entertainment industry is no exception.
For over a century now, not much has change in the Theater and TV broadcast industry, and the way people used to consume the content. However with the digital era now in place, there is a huge change in the users consumption and spending habit.
Multi-Screen is here, Multi-Screen is going to stay, users have started consuming video content weather its Movies, TV Shows and other videos over their computers, laptops, mobile, tablets, Smart TVs or Gaming Consoles. Its fast, its smart and its convenient.
With this change, even the entertainment industry has started to adapt and accept this change. We have seen the rise of VoD platforms like Netflix, Hulu and HBO GO. We have also seen video marketplaces like iTunes, Google Play, Amazon etc rise to the top by syndicating and distributing video content which makes it’s easier for consumers to purchase, rent, download and view this content. Report states that revenues from online television and video subscription revenues (SVOD) is set to reach $13 billion by 2018. Online streaming video services will increase their revenue by 10 billion in next five years. The explosive growth is a reflection of services like Netflix, Amazon Prime Instant Video and other subscription services that have recently gained significant transactions. Take the example of movie All Good Things that made only $500,000 in theaters but made a whopping $6 million in VOD.
Video on demand is the way most people watch movies now: at home with a flick of the remote, on laptops or smartphones with the tap of a finger, renting or buying films through their cable on-demand menus, through subscription services & Video streaming sites like Netflix, or via iTunes or Amazon Instant Video. In 2013, according to the movie and TV tracking company Rentrak, “electronic sell-through” — movies and TV shows ordered On Demand — constituted a $1.18 billion business, up 46 percent from the previous year. Subscription-based services such as Netflix saw a jump of 36 percent, to $3.2 billion. By 2018, video on demand, or VOD, is expected to be a $45 billion market.
What’s more, the home screen is slowly becoming a staging area for bigger movies. When the Weinstein Company released the critically acclaimed art house sci-fi allegory “Snowpiercer” on demand two weeks after its theatrical debut, the digital box office was $5 million in three weeks, versus $4 million in six weeks for brick-and-mortar theaters.
A deal with comedian Adam Sandler for four feature films, produced by the star’s Happy Madison company and going straight to Netflix — no theaters necessary. The media sphere was immediately abuzz with catcalls: Sandler’s on a career downswing, his films are junk anyway. Junk they may be, but they can still reach a huge audience: “Grownups 2” made $133 million earlier this year. Dumb movie, smart move.
At this time we are the cusp of a lot of technological innovation both in content production and content consumption that is more likely to fundamentally change the economics of entertainment industry. With innovation in digital camera technology and computer editing the cost of producing content of decent quality is coming down as you read this post. Low cost of storage is able to store whole libraries out there in the cloud somewhere at very affordable prices. Gone are the days when the distributors had to haul tapes to and fro lockers in the back of their trucks. Gigabyte pipes are available into viewer’s homes making it possible to have high quality streaming experience. Drop in the price of screens is enabling a customer to own screens of various sizes starting from 5inches in the pocket to 60 inches in the lounge room contextualizing content consumption in various form factors.
It is only apt that we are seeing a paradigm shift towards on demand video viewing because a lot of the enabling technologies are in place. This wasn’t true a few years ago. Starting from Disney to Taylor Swift everybody is embracing VOD not as a novelty but as a standard medium to do business in the entertainment industry. From being the in thing VOD today is the norm. So if you are in entertainment industry as a provider and haven’t got on board VOD then you are almost like paddling a canoe to compete with your competitors who are on a jet ski to get to the customers. The right time to get your entertainment brand positioned before your customers using in VOD is Now.
(The writer is Head of Marketing at Muvi helps you launch your own-branded Video on Demand site at ZERO cost and in a matter of few hours! Visit Us to learn more about Video streaming Platforms.)