- With theaters closed to the brim, the big premieres postponed to the last semester of the year and the population confined to their homes, the streaming platforms have found a scenario significantly different from what they expected.
- The line of action has been clear: take advantage of the opportunity. Despite doubts they were planning about maintaining the launch plans, all the projects have continued, including Quibi’s debut in the US or the international landing of Disney +.
- Netflix has been another platform that confinement has been particularly good for as it has exceeded all subscriber expectations. However, those responsible are cautious.
- The real battle will have to be fought in the coming months, since the key to evaluating the impact of this situation will be retention, that is, how many of those new clients will they be able to retain. And above all with more competition for the entry on the scene of Peacock and HBOMax.
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The audiovisual scenario of the first semester of 2020 was going to be marked by the new offensive of video on demand platforms, that the media baptized as Streaming Wars. Disney +, which had launched in late 2019 in the United States (shortly after AppleTV +), completed its first major international landing. It was not the only one. Three other platforms, Quibi, Peacock and HBOMax, were determined to scratch a slice of the North American streaming pie in April, May, and June, respectively.
But then our normality stopped. In March COVID-19 blew up everyone’s agendas and put on hold all those collective activities (including entertainment), turned into high-risk practices overnight. In the last month and a half, the home has become the epicenter around which our daily routine revolves.
With theaters closed to the brim, major releases postponed to the last half of the year and the population confined to their homes, streaming platforms, both existing and new, have found a scenario significantly different from what they expected. The boom of home entertainment It has been the collateral effect of a new way of consuming that, far from appearing somewhat provisional, as many believed at first, is promoting a progressive adaptation of the audiovisual business, of which we have only seen the first manifestations.
An ideal breeding ground
With the confinement of the population, the first concern, in fact, was whether the Network would support such levels of simultaneous consumption. In Spain, according to data from the Internet Madrid ExchangeIn the days following March 15 – the date on which the state of alarm was declared – there was a 23% increase in internet traffic, mainly driven by online video, which represents 70% of total consumption. Psychosis in the face of an alleged general collapse of the Network led to Brussels to ask the main operators to reduce quality streaming to avoid system congestion.
Almost a month later, the internet has not only perfectly withstood the challenge. According the Kantar COVID-19 barometer, made from a panel of 30,000 consumers in more than 50 countries, the health crisis has caused a significant increase in all those services that can be consumed from home, with special emphasis on internet browsing and general television consumption. In Spain, according to the same report, 7 out of 10 consumers declare that these activities have increased significantly in the last month.
Emergency measures in times of uncertainty
The streaming platforms could not have asked for a better scenario to develop their activity. Without a realistic projection of the duration of the health crisis, the first measures have been as reactive as one would expect in a situation with so many unknowns. The line of action has been clear: seize the opportunity. Despite doubts they were planning about maintaining the launch plans, all the projects have gone ahead.
Disney + it kept the original date of its European landing (March 24), except in France. To the French country, the service did not arrive until April 7 at the request of the French Government. The confined families have received the service with open arms, as evidenced by the 8 million new subscribers, according to data presented by the company in early April, raising to 50 million the total number of clients of the platform.
Another platform to which confinement has been particularly good for Netflix. During the first quarter of 2020 (period in which only two weeks of confinement are included), the company saw an increase in subscribers that more than doubled its own projections. Although 16 million additions to the service – which brings the total number of subscribers worldwide to more than 180 million – may be cause for celebration, during the presentation of results they were very cautious.
The real battle will have to be fought in the coming months, since the key to assessing the impact of this situation will be retention, that is, how many of those new customers will they be able to retain. And it is that the current scenario may invite optimism, but the post-COVID-19 scenario does not look good. With a battered economy before the slowdown in economic activity, with the post-confinement syndrome —which will take us away, at least momentarily, from the activities that we have developed in a loop in recent weeks— and given the increase in competition —with its aggressive commercial recruitment policies— getting new clients to decide to stay underwriting will be hard work.
New platforms enter the scene
Another platform that the coronavirus did not discourage from coming onto the market is Quibi, although it forced him to change part of his brand speech. What was called to be a platform to consume on daily commutes was convinced that it could also conquer the user at home, in those dead times between video calls or visits to the kitchen to get a coffee.
But it seems that faith in the product itself was not enough. Quibi has been forced to make decisions that stray from her initial postulates. Thus, for example, it has announced the imminent Launch of an application for Smart TV that will allow you to see your quick bites on TV (against the iron philosophy mobile only with which it was sold to investors and initial customers). In addition, the company decided to opt for a strategy like AppleTV + and globally scale the service directly with the launch. The platform, with its 90-day trial, is available in most countries of the world —although outside the United States and Canada only the advertising version is offered.
Experts assure that Quibi, which has declared more than 2.7 million app installations in the first two weeks, a particular journey through the desert awaits you in July, when the trial periods begin to expire, if by then there is no glimpse of a certain economic recovery that will make people invest in non-essential services.
In the United States, there are still two more platforms on the starting grid: Peacock, the new service from NBCUniversal (Comcast) and HBOMax (AT&T). Both have before them problems of various kinds. The first, the postponement of the Olympic Games to next year. The Olympics were to be their main business push for the general launch on June 15. And, in his absence, they have had to reorganize their marketing strategy in just a month and a half.
HBOMax, whose debut will take place on May 27, has an equally difficult task before it: seducing a viewer facing a critical economic situation, being, as the most expensive platform on the market – $ 14.99 a month – and with one of his star projects suspended due to confinement — the famous Friends Reunion with the original cast-. The company, however, is optimistic. They are confident that if there is one thing that people need right now, it is to laugh. And some of the exclusives from its catalog —such as Friends, The prince of Bel Air, South Park or The Big Bang Theory— they can work the miracle.
Are they really good times for streaming or will it be a mirage?