BroadVision

The COVID-19 pandemic has had a powerful impact on the internet television market. Over several months, the industry has jumped years forward. Films are now premiering on streaming services, online traffic has increased substantially, and operators have gained numerous new subscribers. The events of spring 2020 have defined what the industry will look like in 5 years.

Internet traffic on the rise

With people staying home, engagement with home entertainment increased in Europe and the USA. Users stopped travelling, started postponing expensive purchases like watches or jewelry, and started cooking and watching more TV. In March 2020, Austrian and Spanish viewers were already consuming 50% more content than previously.

The pandemic’s effect on internet traffic by industry (USA)

Streaming services doubled down on compression to avoid network overloads. In March 2020, some governments and ISPs asked Netflix to reduce traffic temporarily, and it managed to achieve a 25% optimization without sacrificing video resolution and service quality

Filming stops globally

Between March and May 2020, all cinemas worldwide closed their doors, and filming was suspended on all film and TV show projects. New arrivals increasingly premiered on streaming services, whilst screenwriting, voice acting, and post-production teams were going remote.

This abrupt stop in filming had a big impact on millions of people, not just actors and film crews, but also electricians, carpenters, drivers, as well as other film industry workers. Over 120,000 people lost their jobs in Hollywood alone.

In April 2020, Netflix transitioned part of its team to remote working and hired 2,500 tech support specialists to maintain the quality of its customer service. Production was halted on the current film and TV show projects. Screenwriters, voice actors, post-production, and VFX teams were working on two hundred new projects. 

Cinemas closed, but the film industry persevered. Streaming services became the go-to destination for premieres, but many films were postponed by months or even years.

Sports content gets scarcer

Most games and championships were cancelled or rescheduled, so viewers became hungry for sports content. Operators were streaming matches with no fans, and recordings of last year’s events.

When the number of verified COVID-19 cases reached 11.4 million worldwide, the Tokyo 2020 Summer Olympics were postponed. The International Olympic Committee and then Prime Minister of Japan Shinzō Abe agreed it would be best to hold them in 2021.

The International Tennis Federation announced that half of its staff were furloughed because of the coronavirus, and 900 matches worldwide were postponed.

After two months of uncertainty, the German Football League held its Bundesliga championship without fans. Formula 1 races held in Austria, Hungary, and Azerbaijan were also held in front of empty stands.

As fresh sports content became scarcer, many pay-TV operators started streaming reruns. Amazon Prime offered recordings of 30 Major League Baseball games from 2019, and almost 80 NBA Hardwood Classics basketball matches to its Prime subscribers in the USA at no additional cost.

The audience still craves sports, so big and small operators will stick with re-runs until the pandemic is over.

Streaming services broadcast news

Many streaming subscribers have forgone linear TV, only using it to watch the news. Over 45% of Hulu viewers don’t watch cable and satellite TV, preferring VoD-only subscriptions. For all its users to catch up on the news, the service added the ABC News Live channel to all its plans for free in March 2020.

In April 2020, Amazon Prime added to its offering CBS News, a 24/7 news channel, and also over 30 free HBO TV shows and films. The content is available to all Amazon users in the USA and requires no Prime subscription. All you need to do is to log into your Amazon account.

Operators are extending their service plans and adding free content. This way, they cultivate customer loyalty and stay competitive in their fight for the audience, which is especially important in the saturated American and Canadian markets.

SVOD model to stay dominant until 2025

Streaming services broadcast news
The inflow of subscribers due to quarantine exceeded streaming services’ expectations. In Q1 2020, Netflix anticipated to attract 7 million new subscribers, but the numbers doubled because of the pandemic. The growth was mild in North America, with most new viewers coming from the Asia Pacific.