Just a few hours more

S08E07: Game of Streams (Just a few hours more)

Our Media Solution Specialist, Magnus Svensson, is sharing his reflections on the online streaming industry in this post. This is part of a monthly series so make sure to follow us here if you do not want to miss an episode.

In the rapidly evolving world of video streaming, engagement and viewing time have become critical metrics that define success. As streaming platforms increasingly adopt ad-funded models, the importance of keeping viewers engaged for longer periods has never been more evident. Advertisers are willing to pay a premium for platforms that guarantee a captive audience, making viewer retention a key revenue driver.

But it is not just the ad-funded services that benefit from high engagement. Subscription-based platforms also rely heavily on viewing time to reduce churn and enhance retention. When subscribers are deeply engaged with the content, they are less likely to cancel their subscriptions, leading to a more stable revenue stream.

In a graph by research firm Owl & Co (with data from Antenna and Nielsen), that was highlighted to me by Lucas Shaw, you can see a direct link between how much time people spend watching a service and how likely they are to keep paying.

Content is the start

Today’s viewers have unlimited entertainment options and to keep providing new and interesting content is essential for attracting viewers and keeping them engaged. By investing heavily in original productions and securing exclusive content deals, Netflix has managed to maintain its leadership position in the streaming market.

New and interesting content also plays a crucial role in generating buzz and driving new subscriptions. The anticipation surrounding the release of a highly awaited series or movie can attract a surge of new subscribers eager to access the latest content.

Without a steady stream of new offerings, even the most popular services risk viewer fatigue and subscriber churn.

Sports as a driver

Live sports have emerged as a critical component for driving viewer engagement and maximizing viewing time. Amazon has been cherry-picking key sporting events for a while, and as soon as Netflix turned their attention to advertising, they have also secured premium sports rights.

Live sports offer a viewing experience that recorded content simply cannot match. The thrill of live events, with their unpredictable outcomes and real-time excitement, captivates audiences in a way that keeps them glued to their screens for extended periods. This provides opportunities to insert advertisements during commercial breaks, halftime, and even through in-game overlays. The longer viewers stay, the more ads they see, directly translating into higher ad revenues.

Sports fans are also known for their dedication and loyalty to follow their favorite teams and events regardless of where it is offered. But securing rights to popular sports leagues and events can also draw in viewers who might not otherwise engage with the content offering.

Not only content and sports

In the age of on-demand streaming, linear viewing and the traditional TV model of scheduled programming retain a major share of the viewing time. Despite the rise of personalized content and binge-watching, a substantial portion of audiences still lean towards linear viewing for its simplicity and convenience. This lean-back experience is particularly valuable for streaming services looking to enhance viewing time and keep viewers engaged.

A significant segment of the population still prefers the structured format of linear viewing. This is particularly true for older demographics who are accustomed to traditional TV and may find the endless choices of on-demand streaming overwhelming. By offering linear channels or playlists, streaming services can attract and retain this audience segment.

As I have stated multiple times, the strength of traditional broadcasters has been curation. Offering curated channels that stream a variety of content, allowing viewers to enjoy an effortless entertainment experience. This approach not only increases viewing time but also keeps viewers engaged longer as they are less likely to switch off when content flows seamlessly.

With modern technology, creating curated playlists comes more or less for free and doesn’t add any significant cost compared to the rest of the tech stack.

To watch out for the coming months…

This summer, two highly anticipated sports events, the European Football Championship and the Olympics will drive massive traffic to streaming services. As these events draw millions of viewers, they underscore the strategic importance of live sports in the streaming industry’s efforts to attract and retain subscribers, enhance viewer satisfaction, and maximize engagement.

Magnus Svensson is a Media Solution Specialist and partner at Eyevinn Technology. Eyevinn Technology is the leading independent consulting company specializing in video technology and media distribution.

Follow me on LinkedIn and X (@svensson00) for regular updates and news.