On the 7th July, our CEO,Lucas Bertrand, led a panel hosted by The British Association for Screen Entertainment (BASE) and The Digital Entertainment Group International (DEGI) on the topic ‘A view from the US’. Panel guests included Andrea Downing, President at PBS Distribution, Max Einhorn, SVP of Acquisitions and Original Production at FilmRise, and Liz Bales, Chief Executive at BASE & DEGI.
The session focused on what, as an industry, needs to evolve as the D2C sector continues to grow in number of services and number of subscriptions being taken up by consumers. Liz Bales stated within this discussion that we still seem to view D2C as the new kid on the block, but if we look at the proportion of the revenue that it is producing across many of the European territories, it is pushing 75% or more of home entertainment revenue. Can 2020 really be used as a benchmark now though, or was this a false peak? Any entertainment company will have likely seen record figures for last year with everyone stuck at home, so are we to expect a steady decline as the World returns to ‘normal’?
John Buffone, Executive Director and Industry Analyst at The NPD Group gave a fascinating presentation on NPD’s latest US TV Switching Study. The study showed that the number of SVoD services that individuals subscribe to is down 17% on last year, the reason being that people simply aren’t watching as much TV as they did during the height of the pandemic. The study proved that new customer acquisition is critical during periods of churn, but the difficulty is reaching these new audiences when their device preferences and partners for sign-up are so fragmented. With this in mind, the priority should be focussed on TV-Connected Devices and maximising marketing efforts to drive viewers directly to the SVoD services in question.
Through this same study we came to learn that new users will often subscribe to an SVoD service for a specific TV series or film. The old saying then that ‘Content is King’ is clearly still very valid. As well as the availability of specific programming though, affordability was high on the list of reasons why new users would likely sign-up, as value for money is of great importance to audiences all over the World.
Everyone on the panel was keen to discuss whether there is a potential for a ‘winner takes all’ scenario, where one company gets the pleasure of aggregating all apps under their own billing umbrella. The general consensus was that the ‘big’ players are only getting bigger, but there will continue to be a place for individual and niche services, but these will likely be added to larger services we already subscribe to. A rise in free services should also be considered when planning an overall content strategy, to balance the shift in the now very fragmented market.
Going back to the view of the consumer, it was noted that with the increase in available services, people are confused as to what content is available where, and this can often lead to the infringement of content. More and more users are also sharing their passwords or using VPNs to avoid signing up to new services, so how can distributors keep tabs on this and prevent it from happening too frequently?
It will be fascinating to see how the film and television ecosystem will adjust over the next few years, and particularly outside of the U.S., where many territories are not as far along in the journey in terms of how consumers are accessing content.
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