The dynamic OTT landscape has kept streaming platforms and content providers on their toes for a while now. This has prompted significant shifts in strategy and technology to secure a slice of the large media pie. Let’s have a look at exactly which of these shifts you should keep an eye on this year.
OTT and Streaming Platform Trends to Track in 2024
Let’s dive into some of the most exciting predictions and trends in the OTT industry for this year.
Subscription fatigue showed itself as the latest roadblock for OTT providers trying to stay on top of the latest trends. With a 17% increase in ad-based platform adoption, compared to a 9% increase in SVOD, according to Comcast’s 2023 State of Streaming, a focus on retaining subscribers rather than gaining new ones might be the answer.
On another note, AI is taking the media industry by storm with a projected CAGR of 26.94% from 2023-2032 (Vision). Thanks in part to new strides in generative AI, the most recent Artificial Intelligence boom in 2023 has prompted streaming platforms to explore new ways OTT platforms can adopt this technology.
Axinom’s 2024 take on OTT trends that will shape the industry will dive head-first into some of the most important evolutions in the space and take you through game-changing insights to put you ahead of the pack.
Subscription Fatigue is real. Here’s what platforms are doing about it
Streaming platforms and services continue to increase in the media industry, as the market revenue is expected to reach $108.5 Billion in 2024, compared to 2023’s $95.88 Billion (Statista). All major OTT content providers have contributed to the industry subscription price hike as new users pour in and the appetite for original content grows. Netflix has seen a price increase for its premium plan five times in the last five years, with other platforms following suit. With these continuous price shifts, customers are looking for new alternatives to access the same content at a lower price.
Data from CivicScience in June indicated that over half of consumers canceled subscriptions due to general price increases. Additionally, more than 40% were downgraded to cheaper, ad-supported versions. The trend of increasing subscriptions has plateaued, possibly reversing. As of August, three-quarters of U.S. adults subscribe to at least one video streaming service, with 53% subscribed to three or more. However, the number of users with four or more subscriptions is declining, while those with one or two are showing an increase. Additionally, in Q2 of 2023, Netlix’s advertising tier generated a higher Average Revenue Per User (ARPU) overall than the standard ad-less tier (Variety).
As OTT providers explore new monetization models to adapt to consumer needs, AVOD allows platforms to lower subscription fees in favor of Ad-based revenue, a change that viewers are increasingly interested in over the standard subscription fees.
Ads or Subs? The Young Viewer’s Dilemma
With a younger audience on the rise, OTT platforms need to consider growing their proportion of the next generation of consumers to get ahead of the competition. This shift in interest further fuels the rise of subscription fatigue within the industry.
According to a survey conducted by Deloitte Insights, the vast majority of Gen Z and Millennials are finding more and more value in User-Generated Content, prompting them to drop their spending on SVOD providers in favor of other media forms.
These groups favor UGC because it is generally free, abundant in authenticity, and provides a tailored experience thanks to the various algorithms that personalize a user’s feed. Additionally, 70% of Gen Zs engage with UGC because it helps them “discover new products and services to buy or use.”
SVOD New Mantra: Stick Around
Integrating different forms of digital media, such as gaming and user-generated content, with traditional streaming services is becoming increasingly crucial to maintaining viewer interest and engagement. (Streaming Media)
Examples of these ventures include Netflix Mobile Games and its ad-supported tier, which gained 8.8 million subscribers in the third quarter of 2023 (CNBC). Amazon has also opted for this route, seeing similar results.
In line with the short-form content formula proven successful by established platforms such as TikTok and Instagram’s “Reels,” OTT providers have joined the trend in their own way. For example, Netflix’s Fast Laughs and Discovery+’s Shorts aim to attract new users, raise engagement, and retain their audience by adding a quick and easy way to find content on the platform.
The focus for OTT platforms is shifting from customer acquisition to customer retention. Companies will beat subscription fatigue by taking advantage of new trends set by a growing young audience. Navigating the new blended media landscape by offering emotionally engaging and resonant content will be increasingly important in light of users losing interest in traditional subscriptions.
AI dubbing is its way to change the OTT space
This year’s rise of AI in the media industry has been monumental. AI is being extensively used for content creation, enhancing metadata, and localizing content, leading to more efficient media operations. 2024’s widespread adoption of AI is set to further revolutionize video streaming services.
The application of AI is constantly expanding, with the most trendy uses including smart encoding, improving content localization and discovery. It revolutionizes the streaming experience, signaling a new era in media technology (Jump).
Another critical implementation of AI is dubbing. AI dubbing revolutionizes content production by offering enhanced efficiency, cost-effectiveness, and multilingual capabilities. It streamlines the dubbing process, allowing for quick conversion of scripts into natural-sounding speech, thus handling large volumes of content efficiently. The technology is more economical than traditional methods, reducing expenses in time and money associated with human voice actors and studios.
AI also excels in multilingual dubbing, ensuring accuracy and cultural relevance, and offers a diverse range of voices and dialects, enhancing the authenticity of the content for a global audience.
Many companies aim to add to the movement, looking to take advantage of this latest trend. With these developments, combined with a projected $125B in revenue for the Global Artificial Intelligence Software Market (dotcom infoway), it’s crystal clear how much of an impact the industry’s embrace of Artificial Intelligence will have. AI is undoubtedly up to the task for lower-level content, with many successful use cases already attesting to AI’s dubbing ability. At the same time, research done by Amazon Science shows that work needs to be done on preserving speech characteristics and semantic transfer.
As 2024 unfolds, new opportunities for OTT providers and their audiences present themselves, marking a shift in industry dynamics. Axinom Mosaic stands at the forefront, offering specialized OTT solutions tailored for content providers. With it’s modular architecture and services that provide essential insights, usage information, and metadata, Mosaic is engineered to help OTT providers smoothly navigate the evolving landscape of 2024 and beyond, ensuring they stay ahead in the rapidly changing world of digital content delivery and audience engagement.