TV monetisation The third way

20,000 foot view:  The slowing of subscription growth in developed markets means that streaming services have to look both towards post-subscription and post-advertising models. A focus on retention will maintain downward pressure on subscription price elasticity, compounded by the need to ration advertising loads to minimise churn. A ‘third way’ approach to monetisation will drive both incremental revenue streams and additional engagement levers for existing consumers. Ultimately this will deliver both increased retention and revenue as streaming moves into an era of consolidation.

Key insights 

• While the            recession is likely to be            consumers will be scarred by            cost-of-living crisis and wary of            subscriptions bill shock
• This will            to an increasing search for            via bundles, telco plans, dynamic            and ad-supported services
• Media fusion            become normalised as digitally-savvy audiences            adapt consumption dynamics and expectations            previously-distinct media verticals
• In 2023,            America will account for            of            video subscribers and            of global            revenue. In 2030 North America            account for            of global subscribers                       of global revenue
• By contrast,            the same period, Asia Pacific            count for            of global subscribers                       of global revenues in 2023,                       of global subscribers and            of            subscription revenues in 2030
• Asia Pacific,            second behind North America, will            the leading subscriber market over            period and additionally become the            revenue market by 2030
• As a            the cultural focus of mainstream            TV content will pivot towards            (south, southeast, and east) 
• Investment in            content with global appeal will            with the 2020s becoming Asia’s            TV moment
• Hybrid streaming            release plans for            households will            media majors to retain ‘silver            while supporting box office engagement            revenue
• Community will            repurposed as watch party dynamics            central to live sports streaming            interactive shopping experiences
• Crucial to            successful ‘third way’ reboot will            in-experience purchases, which are already            in gaming experiences
• The monetization            way will comprise four key            digital merchandise, adaptive pricing, community,            shopping (D.A.C.S.)

Companies and brands mentioned in this report: Comcast, KERV Interactive, Peacock, NBCUniversal, Recurly