The telco, media, and entertainment industries are undergoing profound changes. Streaming services are no longer just platforms for the consumption of films or TV programs, they are now investing in the production and licensing of globally successful own content so are thus in direct competition with the traditional industry. At the same time, broadcasters and media companies are launching their own on-demand offerings and global content producers are setting up their own streaming services.
Also, on-demand video has radically changed consumer behavior. Now consumers increasingly expect relevant and attractive TV and video content that can be accessed anytime, anywhere, and in the format that best suits their immediate needs.
The swiftly changing market landscape and ongoing diversification make it difficult to make long-term predictions about the future. However, Deloitte in its study ‘Future scenarios for the TV and video industry by 2030’ shows what market players need to be prepared for. We show you the keys of this study.
There is a group of relevant influencing factors that the experts predict will have a distinct evolution and also a significant impact on the future of TV and video.
Digitalization: It is fundamentally changing production processes and the distribution of content. All-IP is becoming the standard for TV and video, and fast fiber optic networks and 5G are enabling ever more flexible and mobile consumption of media content. These are being joined by new, intelligent recommendation functionalities based on artificial intelligence and analytics to address consumers in a targeted way.
Coexistence of traditional TV and on-demand content: Linear and on-demand content will be equally important and will coexist. VoD will soon become mainstream but at the same time, linear TV will remain significant. Especially live content such as sports and major events will preserve the high importance of traditional television.
Advertising targeted: TV and video advertising is adapting to new formats and relying more and more on the personalization of advertising content. The analysis of user data makes it possible to optimize ads and content, increase the benefit for potential customers, and ultimately to win them over as consumers. The extent to which this will happen, however, depends very much on the willingness of consumers to hand over their data.
Less regulation: Market regulation in the media industry will be more moderate than it is today. In particular in the area of online and mobile services, this will reduce the regulatory pressure on all market participants, especially on the traditional media companies.
Advertising and direct revenues will remain most relevant: Generating new revenue streams is rather difficult for the TV and video market. Innovative offers such as demand-based pricing for content will not prevail to a major extent. In addition, consumer data will be only partly used in monetization. There are only a few new data-driven revenue streams for broadcasters, as consumers show only a moderate willingness to pay with their data.
A partly consolidated market: The global media industry will be partly consolidated. Stakeholders will make use of strategic mergers, acquisitions, and alliances to strengthen their content quality and distribution capability. Moreover, numerous market players will shift along the value chain by expanding their businesses. Broadcasters will not only focus on their core competencies but also occupy some other positions in the value chain. Over-the-top services become more important in the future TV and video market, whereas tech players play a minor role. Looking at content production, both traditional studios and non-traditional providers will be part of it.
All these last factors are already having an effect on the market but also on the future of TV and video. As a result of all the analysis, the study show us four possible future scenarios for the TV and video industry by 2030.
Scenario 1: Universal Supermarket
In this scenario, a few global digital platform companies will take over the leading role in aggregation and distribution from national broadcasters.
They will control the TV and video market and will enter all steps along the value chain: creation, aggregation, and distribution of content and the direct customer relationship. Like large supermarkets, each of the digital platform companies will offer an extensive range of global and national content, only differentiated by some exclusive productions and sports rights.
Scenario 2: Content Endgame
Large global content owners will be the winners of the market transition. They will integrate vertically along the entire value chain and will start to withdraw and withhold content from digital platform companies and distribute via their own channels, bypassing the platforms and establishing direct customer relationships.
Scenario 3: Revenge of the Broadcasters
In this case, national broadcasters will have successfully accomplished their digital transformation and it will have a strong position in the TV and video ecosystem. Broadcasters will evolve into digital platforms, establish direct customer relationships, and deliver on-demand content. During the transformation process, broadcasters developed excellent digital capabilities. They will enter new services, such as targeted advertising and recommendation functions, which had previously been dominated by the digital platform companies. Furthermore, the high relevance of content for a national audience will put broadcasters in a superior market position, supported by regulatory measures.
Scenario 4: Lost in Diversity
In this last scenario, the TV and video market will evolve into a diverse ecosystem with no dominant players. Instead, consumers will be serv by numerous distribution platforms, a great richness of content, and a steady turnover of players in the market. Demand for national content will remain strong, so partnerships between global and local player will be widespread. Aslo, the clear distinction between content production and distribution will be another key characteristic of this future.
As different as the four future scenarios for the TV and video industry by 2030 may appear, some universal implications are relevant for all market participants and they should take these into account.
Broadcasters and content producers can no longer rely on their present market position. To secure their business models and future revenue streams, they must open themselves to cooperation and alliances, including with direct competitors.
Beyond this, established broadcasters and content producers must constantly invest in their digital competence, because technology has become a core element of their business processes. What is crucial for them is that they are equally attractive to both digital talents and creative minds. What Bill Gates wrote over 20 years ago will still apply in the future: “Content is King”. However, to produce attractive content in a future shaped by digitalization and ultimately to reach the customer with it, first-class technological capabilities are a necessity.
You can see the completely study here:
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