i3 | August 18, 2017

Live Streaming Rearranges the TV Ecosystem

Gary Arlen

Whether it’s the NFL, a prime-time network TV series or live special programming, video is being delivered via non-traditional methods.

Whether it’s the NFL, a prime-time network TV series or live special programming, video is being delivered via non-traditional methods. Internet-delivered over-the-top television is overhauling the 70-year old TV industry, thanks to options like “skinny bundles” from Hulu, AT&T’s DirecTV Now, DISH’s Sling TV or Sony’s PlayStation Vue, or original content on YouTubeTV and Twitter. By 2021, the global live video streaming business will generate $70 billion in revenues, up from $30 billion today, an 18 percent growth rate, according to a MarketsAndMarkets.com forecast. That is in the same vicinity as U.S. broadcast TV advertising revenue.

Real-time live streaming is erupting in many ways. For example, Turner Broadcasting’s TBS and TNT, cable networks owned by Time Warner, are expanding their digital footprints via streaming apps accessible on iOS, Apple TV, Android and Amazon Fire as well as Roku, Google Chromecast and VIZIO SmartCast devices. TBS and TNT are the first major networks to include Vizbee technology, allowing viewers to cast content from a mobile device to any connected screen without a special plugin. This wireless digital strategy gives viewers more ways to watch TNT and TBS programs.

Binge Streaming Marathons

In May, Twitch, an Amazon-owned video game service, began an 18-day transmission of all 886 episodes of the popular public TV show Mister Rogers’ Neighborhood and even showed episodes that only aired once. Meanwhile, Verizon is paying the NFL more than $20 million to stream the September 24 game in London between the Jacksonville Jaguars and the Baltimore Ravens to all Verizon platforms: AOL, FiOS, go90 and Complex Networks (digital video co-owned with Hearst Corp.). If the deal goes through, Yahoo CBS-TV, which would normally carry the game, will only show it on its local affiliates in the two teams’ hometowns. Sky Sports will carry the game in the UK and Verizon will offer streams to other international online audiences. The streamed game is part of the NFL’s exploration of how to deliver live video when its broadcast contracts come up for review in a few years. Amazon is paying $50 million to stream 10 games through its Prime system this year, and Twitter streamed 10 NFL games last season.

Sports events, once the crown jewels of live telecasting, are only part of the live streaming juggernaut. Hulu’s new $40-per-month streaming service includes channels like Food Network, Travel Channel and HGTV that are packaged into cable’s big bundles. “By bringing together thousands of live and on-demand libraries of shows and movies, Hulu can now be a viewer’s primary source of television,” CEO Mike Hopkins explains. For an extra $4 monthly, Hulu offers a commercial-free version, and a $19.99-per-month package which includes a cloud DVR and multi-screen access. Even when added together, those fees are lower than a typical cable TV subscription.

YouTube Live is attracting vast audiences with a different approach. There were 6.9 billion views during the first quarter of 2017, according to Tubular Labs’ latest State of Online Video report. Gaming content (eSports) accounts for 53 percent of YouTube TV’s live programming, while technology (15 percent) and news (12 percent) draw substantial audiences. In the spring, YouTube opened streaming capabilities to any user with 1,000 subscribers, encouraging corporate or private creators to set up their own programs.

The Casualties

The Digital Entertainment Group’s (DEG) recent study shows a steep decline in purchase and rental of entertainment content from 2015 to 2017. Analysts believe that DEG’s tally of $1.8 billion spent on SVOD during the first three months of this year may be undercounted.

Live streaming is reinventing the TV business, even as traditional broadcast and cable companies prepare to use new tools to compete in the world of 2020 television.

July/August 2017 i3 Cover Issue

Subscribe to i3 Magazine

i3, the flagship magazine from the Consumer Technology Association (CTA)®, focuses on innovation in technology, policy and business as well as the entrepreneurs, industry leaders and startups that grow the consumer technology industry. Subscriptions to i3 are available free to qualified participants in the consumer electronics industry.