2019 was a monumental year in the OTT space. Dominating both news headlines and consumers’ daily lives, streaming video has cemented itself as the new bedrock of movie and TV culture. OTT services have almost managed to completely overtake traditional television, and there’s no longer a question of if they’ll beat TV but simply when streaming numbers will surpass cable’s.
The growth of streaming video has continued to skyrocket, and 2020 is set to be another big year of developments as streaming becomes even more deeply ingrained in our lives. But before we dive into the new year, let’s revisit some of the biggest takeaways from 2019 and consider what they might predict about the new year and new decade at hand.
- Mobile became the top place to watch video online: 2019 saw continued growth in mobile video viewership. In fact, 2019 was the first year that smartphones became the most popular device where people watch online video globally—ahead of computers, tablets, and connected TVs (Limelight 2019). Providers took notice and began to roll out better mobile features and Netflix even launched a mobile-only subscription tier in a few global markets.
- Several huge new services launched (or were announced): In an already crowded industry, media and tech giants entered to try their hand at streaming video in 2019. Disney+ and Apple TV+ led the pack and will be followed by NBCU’s Peacock, Quibi, and HBO Max in 2020, showing that the OTT space is only going to get more cluttered and more competitive. Viewers are already experiencing streaming service fatigue, with nearly 50% reporting frustration at the number of services they need to watch the content they want, and providers are going to have to pull out all the stops to make sure they aren’t decimated by high churn rates in the upcoming year.
- Downloading became a necessary feature: Viewers enjoy downloading video to their mobile devices because it lets them watch seamlessly, regardless of how good their connection is. Whether at home, on a plane, or commuting, downloading is becoming a popular way to circumvent the issues that come with increased mobile viewing. In 2019, more and more VOD providers began to understand the importance of a download feature. Hulu finally added the feature (though users complained about its limited functionality) and the two biggest OTT launches (Disney+ and AppleTV+) both included downloading in their apps and promoted the feature as a reason to subscribe.
- Expectations about 5G are more realistic: 5G is starting to roll out in some markets, and people are starting to realize that the hype around the new cellular technology has been overblown. As we’ve known for a while, 5G will make some great improvements, helping improve the speed of streaming and downloading, but will be far from solving all the issues faced by mobile consumers.
- Global audiences become a bigger priority: The battle for eyeballs has become intense, and this isn’t limited to U.S. audiences. As new services aim to topple Netflix, they have begun to strategize around international markets, too, where streaming video is just as popular as it is in the U.S., and in some cases more.
- Viewers are more frustrated with playback issues: As streaming video becomes more popular, user expectations are becoming higher than ever. We know this because in 2019, users in the U.S. and abroad reported more frustration with issues like buffering than in 2018. In the U.S. alone, the percentage of viewers frustrated by streaming grew from 81% in 2018 to 88% in 2019. Plus, Disney+ faced a huge PR crisis when their launch was marred by user complaints about buffering. With so many services available, many cord cutters are now paying as much as they did for cable, and they expect a viewing experience that’s just as good, if not better, than what TV has provided.
- The streaming ad problems (and opportunities) became crystal clear: Ad spending on digital video has been steadily growing, but in 2019 studies from Conviva revealed that approximately 40% of streaming ad starts fail. This presents a huge challenge for providers, who risk losing the loyalty of both frustrated viewers as well as advertisers who don’t want to be associated with a negative experience. At the same time, the opportunity around ad-support video on demand have become impossible to ignore as many believe AVODs might be the best way to combat subscription fatigue. NBCU is considering launching their Peacock service with a free or discounted, ad-supported tier and many predict that even Netflix will launch an ad-supported tier to their offerings in the near future. As more inventory becomes available in 2020, it will be crucial for streaming services to find a way to solve the problem that plague streaming ads in order to get the most out of the enormous opportunity at hand.
It’s been an eventful year for streaming video, and with more services scheduled to launch in 2020, the battle for viewers will become even more intense. That means 2020 must be the year providers solve the problems that plague their viewers and work to perfect the user experience. Otherwise, 2020 will be the year they lose out to video services that do.