Streaming services have never been so present in everyday life. They changed the way music and movies are experienced, to the point of revolutionizing the whole entertainment industry, and forcing enormous changes on the consumer/provider dynamics.
For this reason people are overwhelmed with options, with a new one popping up every couple of months, and each one with a different value proposition. This should be good, right? Well, it was for a while, until the apps kept piling up and with each one a new account added, and a new bill to be aware of.
The stress point of having to jump back and forth between streaming services in order to watch any type of content is taking its toll, and many companies are addressing this situation with an undeniable value proposition. Instead of focusing on content acquisition to feature a movie or a TV show, they are also offering the possibility to subscribe to other streaming services from within, expanding on their offering while minimizing costs, providing a better user experience and, most importantly, gaining revenue from platform “rent space”.
This can be seen as taking advantage of less resourceful content providers, but it’s actually a win-win situation for all the parties involved. Most niche or small streaming services struggle to find their audience, and while making the journey towards a profitable future, the engine just doesn’t go as fast as the fuel being put into it. So, if there’s a chance to get their product to a larger audience by offering their service to an aggregator, they would not only ensure it would be available in more places to get discovered, but they could also take a bigger profit by means of revenue share. This way the aggregator would increase its ecosystem and overall range of products, while smaller services would only lose a small cut compared to not having a big platform to showcase their services.
This model has been known to work rather well, with even established companies going through this route to expand their viewership and profits. Look at HBO, for example. HBO has a worldwide reputation for being a quality content creator and a leader when it comes to Pay-TV, also making a worldwide move through their OTT subscription service, but this didn’t stop the goliath from sharing their content with other streaming platforms.
If you look into Amazon Prime Video, Hulu or even Apple TV, you can see the HBO add-on right there for subscription, and the same goes for many other players in the industry who have no problems in distributing their content outside their main app, going for a revenue share strategy. Plus, you have to take into consideration the way people move around OTT platforms.
The major hassle of subscribing to multiple platforms in finding content. When subscribing to Netflix, HBO or Disney +, you have to go from app to app, looking for the content you want. Over time, people get fed up with this kind of time consuming tasks and usually stick to the one most of their friend circle has, in order to get into the conversation and group social dynamics. Remember that this is only a business for you, to audiences around the world you represent entertainment, and entertainment doesn’t go well with hard work. This hard work is also applied to the multiple billing cycles you have to create when joining various different OTT apps, so it’s a no-brainer to think that having, or being a part of, an aggregator offering will significantly improve your retention numbers and consumer choice preference.
That takes us to another point, if content aggregation is going to be the future, you don’t have to rush in and spend all your hard earned money on all available content. No, take a step back and keep making smart choices. Many service providers will make the bad decision of getting as many services as they can and crunch them all together, but you, being above all others (wink wink), will assess the market and carefully choose a line of content that fits your needs. Plus, when this prediction becomes a reality, user experience will be even more of a deciding factor than it already is, and if everyone packs the same content, users will be looking at comfort first and content second.
To sum it all up, make smart deals. Make partnerships and either become an aggregator or share your service with them, you’ll have a better return on your investment. The landscape is becoming oversaturated with services who want to become the next Netflix, when the reality of the situation is that even Netflix is being forced to pivot and is slowly moving its way into becoming a production company. Aggregation is the new black, put content pride aside and be prouder of your business choices.
