The media and entertainment industry is constantly evolving, driven by shifting consumer preferences and technology advancements. 2023 saw an uptake in the use of AI, the popularity of FAST services, strategies to improve monetization opportunities and more. This year will undoubtedly bring more uncertainty for providers with difficult scenarios to navigate within the landscape. However, these challenges will also present opportunities for technology and for services to develop changes that will reshape the industry. Here are some of the trends that we think will make an impact:
Bundling to Survive
Subscription video-on-demand (SVOD) services are trying to rebuild cable services, bringing everything together under one subscription. With the rise of OTT, everything was separate and fragmented, meaning that services were fighting to acquire customers. This year, as one way to battle churn, subscription services are continuing to partner up and be a part of a multi-service bundling subscription to keep their audiences. In a recent survey, 53% of executives said ‘super-bundling’ within a centralized subscription management hub provided by aggregators like telcos will play a vital role in their future customer acquisition and retention strategies. There will be a rise in SVOD options this year, with different packages available via one subscription to the consumer.
Improving User Experience with AI
AI will continue to make waves in the M&E industry this year, but instead of developing ‘new technology’ the focus will be on optimizing the use of AI. For streaming services with so much competition, providers need to be able to separate their service apart from others within the market, AI can help contribute to a bespoke experience. AI and ML have been used for many years for recommendations, but now, more progress will concentrate on making more individual experiences, such as a totally unique UI with text and content served up for users based on their behavior and preferences.
The Continued Rise of AVOD and the Importance of Targeted Advertising
In addition to service bundling, operators and streaming providers are pivoting to advertising tiers to enable subscribers to have a cheaper subscription and keep users as customers. For example, Amazon announced that ads are coming to their service for 10 global markets in 2024. There is a need to improve the advertisement experience as more people choose this level of commitment. Getting your ads right and relevant for users is more important than ever, as it’s a significant revenue stream for big providers. This year, Netflix is set to overtake Disney+ in ad revenues with $1.03 billion, compared to Disney with $911.9 million.
What’s Next for FAST?
Will FAST truly dominate in 2024? The free aspect has definitely been enticing more viewers during the economic uncertainty and the laid-back style of viewing in the last year, meaning that it’s been widely adopted in many markets. For this year, to keep viewers returning and keep up its popularity, FAST providers need to focus more on user experience. There is a huge opportunity for FAST services to improve engagement within platforms, to make it easier for users to find the content they want to watch. As well as viewers, FAST is gaining more momentum with advertisers as well, 84% of FAST advertisers expect to grow their spending in 2024. For advertisers, FAST provides an option to target a specific audience and has been proven as a strategy for cost-effectiveness.
This year, services should prioritize making entertainment a hub once again, providing simpler and more personalized experiences not just for the content they consume, but where they consume it, how they are exposed to advertisements and more.
Enhance your personalization experiences for your users with XroadMedia by having personalization going further than the UI. If you’re looking to improve your customer experience in 2024 by bringing back the joy to TV, get in touch with our experts today.