Streaming Wars Rage On: Analyzing The Features People Value Most In Video-On-Demand (VOD) Services

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Between the recent influx of competition entering the VOD space (like Disney+ and NBC’s Peacock), big-budget original TV series premiering on OG networks (like FOX’s Deputy), and enticing partnerships/subscription bundles cropping up (like Spotify +Hulu), the streaming wars are certainly raging on in 2020.

The companies that offer the best features will succeed.

People have limited time and money to spend on VOD streaming services, and brands know this. For this reason, there has been MASS spending on trying to give the people what they want, both in content and pricing options/business models.

People have limited time and money to spend on VOD streaming services, and brands know this. For this reason, there has been MASS spending on trying to give the people what they want, both in content and pricing options/business models.

Content

The graph below highlights the predicted spend VOD services will make on creating or acquiring content for its audiences in 2020, and in 2024. Across the board, data analysts from eMarketer predict increases in spending on content.

Pricing options / business models:

Companies are deploying several different business models to sell their content – ranging from pricing tiers, to device support, ad-supported content, download functionalities and more. But which is the most enticing to people?

EMarketer put out a report last month that showed that the #1 feature that would make internet users more likely to buy a subscription is ad-free membership options – followed by bundled/discounted streaming services. On the flip side, a significant number of respondents also indicated that discounted membership options that include ads would also influence their buying decisions.

EMarketer put out a report last month that showed that the #1 feature that would make internet users more likely to buy a subscription is ad-free membership options, followed by bundled/discounted streaming services.

On the flip side, a significant number of respondents also indicated that discounted membership options that include ads would also influence their buying decisions.

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eMarketer VOD Reports, November 2019

Hulu is a good example of using different pricing tiers based on users’ exposure to advertisements, and HBO Max is rumored to be rolling out a lower-cost ad-supported tier in 2121. Yet, most SVOD services – like Netflix, Amazon Prime Video, and FOXNow – have communicated that they are not interested in creating lower-cost/ad-supported membership plans any time soon.

Hulu offers different pricing tiers based on users’ exposure to advertisements.

An uphill battle for new players

Researchers expect the US demand for VOD services to increase, and the number of pay TV subscribers decrease over the next five years. However — data suggests that users are only spending their time and money within their three (or so) favorite streaming apps.

Statista predicts increased VOD users in the US over the next five years.

Adding fuel to the fire, to a recent survey discussed on FOX Business, more than half of U.S. households are subscribed to Netflix, more than a third are subscribed to Amazon Prime, and more than a quarter are subscribed to Hulu. With these three companies having such a stronghold on the market, it may be difficult to get consumers to shell out more cash for new players.

Wrapping up

It will be interesting to see how SVOD companies’ platforms, pricing, and content will evolve over the next year, and no one can say for sure at this point who will win these “streaming wars”. Share your opinions below!

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