All Major TV Networks Will Offer A Direct-to-Consumer Streaming Service By 2022

The unbundling of cable TV packages will accelerate over the next five years, with all major TV networks launching standalone direct-to-consumer (DTC) streaming services by 2022 — this according to a new report from The Diffusion Group. tv networks and streaming services

“Big media companies are reacting more boldly to changes in TV viewing behavior,” notes Mike Berkley, TDG senior advisor and author of the new report. “Consolidating, bulking up on originals, and marketing directly to consumers are driving their strategic direction.”

The industry first flirted with DTC models three years ago when HBO and CBS launched the industry’s first standalone subscription services. Today, both brands enjoy five million paying DTC subscribers. As well, Disney is set to launch its much-anticipated ESPN Plus DTC product, and plans to roll a Disney-branded DTC service in early 2019 featuring animated films and Marvel and Star Wars titles, among other high-value content. Notably, this is timed to the expiration of its contract with Netflix.

These are early signs of an emerging media tribalism,” argues Berkley. “Major networks will increasingly reserve their best titles for their own direct-to-consumer services, which will help drive total network DTC subscriptions close to 50 million by 2022.”

Berkley warns, however, that DTC strategies come with great risk, especially for TV networks. “The legacy model is built upon decades of comfortable relationships between networks and operators. If networks extract too much high-value content too quickly, channel conflicts are inevitable.”

TDG’s new report, The Future of Direct-to-Consumer Video Services – Analysis & Forecasts, 2018-2028, examines the factors driving demand for direct-to-consumer streaming subscriptions, and the challenges TV networks face incorporating this new business model. It also analyzes the strategies of each TV Network family and the role Amazon Channels will play as an aggregator of a la carte TV services.

Forecasts contained in this report include service subscriptions through 2022, apportioned by brand; number of DTC subscriptions per user household; pricing and ARPU trends; and annual revenue. tv networks and streaming services

 

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