The Future of Streaming Is a Blast From the Past

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The 2010s revolutionized home entertainment, as global subscription video on demand (SVOD) services gained significant power and popularity during this time by selling content directly to consumers. Yet, it’s worth noting that the success of these streaming giants might have been influenced by a low-interest-rate climate. As we move forward, these SVOD platforms will continue to be dominant players in the market, but their distribution methods may grow more indirect over time.

Deloitte anticipates that the sector is moving towards a model where multiple subscription services are grouped together, mimicking traditional pay-TV packages. As subscription video on demand (SVOD) platforms become saturated in major markets, they’re looking for innovative methods to attract new viewers and decrease cancellations. Although revenues might still grow with price hikes, bundling offers, and stricter password policies, we foresee a decline in the total number of individual subscriptions.

As a dedicated streaming enthusiast, I find this resurgence of content aggregation, despite initial reservations, to be an essential step forward for our cherished streaming world. This transition promises advantages not only for content creators but also for us, the viewers.

In the 2010s, I found myself part of a growing trend: the convenience and appeal of subscription video on demand (SVOD) services were irresistible. These platforms offered an endless array of choices at my fingertips, making it simple to explore hundreds of titles all in one place. The freedom to select which service I preferred was empowering, and the option to binge-watch content instead of waiting for weekly episodes was a game-changer. To top it off, these services provided ad-free premium content and increasingly original programming, making them highly sought after by consumers like me.

The affordability aspect has significantly contributed to the popularity and fast expansion of SVOD (Streaming Video On Demand). Traditional TV packages generally tend to be more expensive than SVOD services, which makes them a more appealing choice for budget-conscious consumers. Moreover, this affordability allows many individuals to select multiple services according to their content preferences, a practice often referred to as “subscription cycling” – subscribing when desirable content is available and canceling when it’s not.

The increase in affordable options, wide variety, and power to manage subscriptions and preferences has resulted in an explosion of available services. Similar to other technological advancements following the pandemic, there’s been some weariness among consumers towards products and services that were heavily utilized during times of boredom.

There are now many more services because they’re affordable, you have lots of choices, and you can easily manage them. After the pandemic, people aren’t as interested in using products and services as much as they did when they were bored.

Lately, I’ve been feeling the pinch from rising costs and inflation, which seem to be pushing up prices everywhere. Adding to the strain is the introduction of new subscription tiers for various streaming services, making it even harder on my wallet. This shift in the world of Streaming Video on Demand (SVOD) has led to a slowdown in subscriber growth, and globally, the average number of subscriptions per consumer seems to have plateaued.

For instance, Deloitte’s research shows that the average number of subscriptions per European consumer increased from 1.3 in 2018 to 2.35 in both 2023 and 2024. In the United States, though the number of subscriptions remains higher than Europe at 4.0 since 2020, it too has reached a plateau.

Streaming service providers are constantly searching for innovative methods to expand their reach and grow their subscriber base. This includes stricter policies on password sharing, venturing into live broadcasts, games, and dedicating more resources to unique content. However, the rise in the average number of subscriptions individuals hold has sparked questions about the sustainability of a market predominantly filled with numerous individual consumer-direct providers.

It’s expected that the trend of consumers subscribing to numerous individual streaming platforms (referred to as “stacking”) may decrease in the coming year. Instead, it seems that the streaming industry might shift towards bundling content from various providers, similar to the structure of traditional pay TV packages.

Instead of moving backward to a model with multiple subscriptions, it could be beneficial to reconsider a form of the bundling approach. This adjustment might just strike the right equilibrium for both consumers and providers. For consumers, this change could lead to a streamlined experience, as they would have fewer platforms to sift through, pay for, and manage. Additionally, it may lower costs and reduce the time spent sorting through vast amounts of content. A unified search bar could provide a smoother browsing experience.

In the meantime, suppliers of Streaming Video On Demand (SVOD) could find aggregation as a valuable opportunity to address rising churn rates and expand into new markets and income sources. Notably, successful aggregation models have emerged in recent times, such as bundles from large streamers or cable packages incorporating streaming services. It’s worth noting that aggregation is not exclusive to media; it is widely used across various industries as well.

Aggregation can manifest in several forms. For instance, service bundling, where Subscription Video on Demand (SVOD) subscriptions are linked to pay TV, telecom, or financial services contracts, is currently being employed. This frequently results in reduced prices for consumers compared to buying services individually. This benefits SVOD providers by lowering churn rates, as subscribers often agree to minimum contract terms, and assists telcos by boosting customer retention.

In other places, we find media bundling, where various services are combined, usually by offering multiple services at a reduced price compared to the cost of purchasing them individually. Some smaller streaming video on demand (SVOD) services are shifting their strategy from selling directly to consumers as standalone services to becoming additional channels distributed by aggregators, or even withdrawing from certain markets entirely. Additionally, free ad-supported television (FAST) options and free video on demand (VOD) services may expand.

To stay relevant, individual Streaming Video on Demand (SVoD) services might need to team up with bundles or find ways to distinguish themselves through variety to break through the fierce competition. On the other hand, traditional broadcasters could potentially win back viewers, especially if they update their content and invest in digital technology for a more modern approach.

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In order to remain competitive, standalone SVoD services may consider joining forces with bundles or offering unique content to cut through the competition. Meanwhile, traditional broadcasters could regain lost viewers by modernizing their offerings and investing in digital platforms.

People seeking a simpler and less expensive form of entertainment might find bundled content and services beneficial, but it’s important to understand there could be limitations in terms of options and adaptability. Whether these compromises are deemed acceptable will hinge on whether Streaming Video On Demand (SVOD) providers can consistently offer top-tier content that is both accessible and cost-effective.

Essentially, the television industry is experiencing another phase of change. Moving towards collection platforms may present hurdles, yet it’s an ongoing transformation that has been unfolding for several decades, transitioning from conventional airwaves to digital content delivery online.

Independent Streaming Video on Demand (SVOD) providers might want to decide on their desired position within this evolving model. This could mean continuing as a comprehensive SVOD service, or venturing into the role of aggregator, gathering content from other providers alongside their own offerings.

As a fan, I’ve come to realize that going directly to consumers isn’t a walk in the park for brands in the video industry. Distributors continue to play a significant role in our success. For content creators who have been supplying others for decades, transitioning into a direct-to-consumer model might initially prove challenging. But, I believe that embracing aggregation can be a sensible solution to tackle high customer churn rates, slow growth, and the necessity to turn a profit.

Even though subscription video-on-demand (SVOD) may not be the leading business model, broadcasters should not become complacent as they still control a significant portion of viewing time in various markets. Instead, they should collaborate to strengthen their resilience and expand their allure, especially among younger demographics who are shaping consumer preferences and habits.

Either way, aggregation is likely to be a defining feature in the years to come.

As a gaming enthusiast, I’m proud to be a part of the dynamic team at Monitor Deloitte, where I focus on maximizing value for clients within the media, entertainment, and telecoms industries. My expertise lies in strategic planning, business design, and leading transformations, all aimed at driving success.

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2025-03-26 22:55