The entertainment industry has experienced a raft of change since the COVID-19 outbreak. With more of our time spent indoors, we’ve naturally seen TV consumption rise across all age groups, as we continue to explore different forms of content during life in lockdown. This leads us onto some much-needed positivity around the short and long-term opportunities across the TV industry, during what truly is an unsettling time for us all.
From linear and broadcast TV, to VOD and premium subscription services, we’ve seen a marked increase in consumption across the board. One of the most intriguing and timely examples of this is the launch of Disney Plus in the UK. With this launch and the momentum from more recent launches such as Britbox and Apple TV+, combined with expected further growth from Netflix, over 5 million new SVoD subscriptions are estimated to have been taken out in the UK in less than a month since lockdown. Going forward, we’ll most definitely experience increased competition for media and video services like we’ve never seen before.
It’s not, however, all doom and gloom for linear and broadcast TV. Currently, linear TV still remains a crucial element of our viewing habits, as we require a source of familiarity during these uncertain times. A careful balance is needed between the escapism provided by SVoD platforms like Netflix and the comfort sought from live-TV updates that keep us connected to the outside world.
Despite the speculation around whether networks would be able to cope with the increased delivery of digital streaming services, BT has stated there has been a 45% increase in its broadband traffic during the lockdown period and is still far off reaching network capacity, which indicates that there’s plenty of headroom for further increase in consumption. Networks have successfully proven their ability to cope with the sudden demand, posing the big question as to how this will accelerate the speed of IP delivery moving forward.
Crucially, what the pandemic has caused is a shift in viewing behaviour. Consumers have been looking for alternatives to replace gaps in their usual TV schedule, with soap operas in particular being placed on hold due to the temporary freeze in production. As a result the older generation have been exposed to a wider environment of platforms, genres and services, providing them with interesting alternatives away from their usual dependence on Live TV.
In relation to this, social media and Youtube specifically have captured a much wider audience, with Joe Wickes hitting almost 1 million live streams on YouTube. We’re also seeing the ever-growing use of ‘snackable’ short clips across Instagram, providing comforting advice, entertainment suggestions, and generally helping us to stay connected with our peers. In terms of emerging segments, Esports and virtual racing have taken the opportunity to really develop a new audience over the last few weeks and has significantly widened its demographic from the norm. This has shown that a much wider audience has grown to appreciate the depth of these different services and segments during lockdown and we predict that this will continue into the latter half of the year and beyond.
SVoD services will need to focus on subscriber retention in H2, as multiple SVoD uptake will remain common place. Around half of all UK households had an SVoD subscription at the end of 2019, and Futuresource’s Living With Digital survey suggested a significant appetite will lead to households taking at least one additional service in 2020, with this appetite even greater amongst those with existing multiple subscriptions.
A new diversity of viewing levels will most certainly continue after lockdown. What this will serve to do is fragment the industry further, in a way that will provide more opportunities for key players to broaden their demographic outside of their usual target market. Behavioural changes experienced during isolation may also go on to impact the type of content genres being commissioned. Overall, we should expect to see a long-term reinvention in advertising, as the industry will be pressured to make up the shortfall in revenue. How they look to reinvent the wheel remains to be seen, as current programming will undergo significant adjustments to match a viewing landscape that is now notably different to what has previously been experienced.
Our Principal Analyst David Sidebottom joined a webinar panel, alongside Richard Lindsay-Davies, for DTG's webcast, to talk through the current transformation across the Entertainment industry. If you would like to view this, please click here>>
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