As 2024 approaches, there’s a lot of speculation in the industry about the future of the OTT video market and the key trends to watch out for. Making these predictions is always a challenging yet enjoyable task.
As the CEO of JUMP, I’m excited to share our six key predictions for the OTT video streaming industry in 2024. Each of these trends reflects the rapid evolution of the media landscape and our commitment to staying at the forefront of these changes.
Embracing Diversified Revenue Models
During 2023, we observed major players such as Netflix and Disney+ introducing ad-supported tier options to diversify their income sources.
Many leading video streaming services are considering bundling their content to enhance their catalogs and improve the user experience.
Additionally, a significant number of media brands have launched their Free Ad-Supported Streaming TV (FAST) channels, and those that haven’t are undoubtedly exploring the possibility of launching their own FAST channels as part of a broader strategy to increase revenue streams.
In 2024, it is expected that most video streaming services will adapt their business model strategies by exploring new revenue models.
The Rebundling year
As more streaming companies embrace advertising and recognize the necessity of an ad-supported tier to attract viewers and scale in the market, this shift is likely to lead to an increased fragmentation of streaming apps. This proliferation can complicate the viewing experience for consumers looking for relaxation and wanting to avoid the paradox of choice.
I foresee a trend towards more industry consolidation and a revival of redesigned bundling in 2024.
Given the declining number of subscriptions per streaming customer and growing frustration with fragmentation, bundling, and collaboration between streaming competitors appear to be a logical solution.
Additionally, PayTV operators are positioning themselves as prime aggregators, effectively marking a return to the pay-TV model, adapted for the modern era.
In summary, in 2024, media companies are expected to increasingly focus on bundle partnerships to strengthen customer relationships and reduce churn.
Revisiting Content Licensing Strategies
In 2024, the media industry is poised to experience a substantial shift toward more extensive content licensing, a trend underscored by HBO’s decision to license its shows to Netflix in 2023. This development is anticipated to include a wide array of participants from across the industry.
Moreover, the trend is expected to continue and even increase with niche streaming platforms, as well as streaming giants like Amazon Channels and Roku Channels, entering into licensing agreements. These agreements are aimed at expanding their content offerings and reaching new audiences.
This collaborative approach within the industry goes beyond merely seeking new revenue streams; it marks a strategic move towards leveraging shared resources and forming partnerships.
Through these diverse content agreements, media companies are looking to boost viewer engagement, broaden their global reach, and forge a more sustainable business model amidst the ever-changing landscape of digital media.
Enhancing Discoverability and Data Transparency in FAST Channels
Free Ad-Supported Streaming TV (FAST) channels have notably impacted the media industry’s business model, yet challenges in discoverability and user experience may hinder their long-term success. While they fulfill a need for simplicity, there’s potential for misalignment with the evolving expectations of consumers, indicating a need for user experience innovation.
In 2024, FAST is gaining popularity among streaming audiences and advertisers due to its no-cost model and diverse content offerings across various themes like news, sports, music, documentaries, and more. These features make FAST channels appealing complements to Subscription Video On Demand (SVOD) or Ad-Supported Video On Demand (AVOD) services.
However, the rise in advertising spend on FAST channels has led to a demand for detailed data in their measurement. Currently, measurements primarily occur at the platform level, such as Samsung TV Plus or Pluto, rather than on the content owners’ direct-to-consumer platforms. This method falls short in providing detailed insights into content performance and audience engagement for each channel, emphasizing the need for more data as the industry moves towards targeted audience segments.
I predict significant efforts will be made to better understand more granular consumption on these platforms, enabling smarter content curation and improving content discovery for users during their viewing experience.
Integrating AI Across Video Service Operations
The rise of AI in 2023 has been transformative, mirroring the impact of the Internet in the mid-nineties. Generative AI, particularly in its evolving state, is making notable strides in content creation and enhancement. Media companies are adopting AI for various tasks, including metadata enhancement, localization, and improving cost efficiencies in content operations, leading to increased overall efficiency.
As the standout trend of 2023, AI is expected to continue and even accelerate its influence in 2024, with a plethora of AI-driven innovations already transforming the media tech landscape. In 2024, AI is poised to play a crucial role in optimizing video streaming services. Its capabilities extend to providing AI-powered business insights, automating marketing strategies, preventing churn, enabling smart encoding, and advancing personalization and discovery in content. These diverse applications demonstrate how AI can significantly boost team productivity and refine streaming experiences, heralding a new era in the technological evolution of video services.
Elevating User Experience with Enhanced Search and Discovery
In the OTT (Over-The-Top) domain, personalization poses an intricate challenge due to the ever-changing nature of viewer preferences, which are influenced by factors such as mood, context, and family dynamics. The task of accurately predicting and catering to these preferences remains complex.
While completely mastering personalization in OTT may not be achievable by 2024, there is an evident shift towards enhancing user experiences to build loyalty and engagement. Users are increasingly demanding more powerful search and discovery features in their streaming services, which can intuitively understand and adapt to their viewing habits and preferences. This demand is driving service providers to invest in more sophisticated algorithms and AI-driven technologies.
Innovations in personalization will likely include more refined recommendation engines, improved content categorization, and interactive features that allow users to provide direct feedback on their preferences. These advancements will not only help service providers to better align content with individual user needs but also enhance the overall user experience, making it more engaging and satisfying.
In conclusion, as we step into 2024, these predictions underline our commitment to innovation and excellence in the OTT video streaming industry. We at JUMP are excited to be part of this journey and look forward to contributing to an ever-evolving media landscape. Wishing everyone a happy and prosperous 2024, filled with groundbreaking developments and enriched viewing experiences!
CEO & Co-Founder
JUMP – Data-Driven Video