There’s A Whole Lot of Streamin’ Goin’ On
Although its popularity has never been greater, streaming digital media has been around for a quite a while. The first streaming audio event was in 1995, and streaming video came just a couple of years later, in 1997. Though traditional sources of television programming (terrestrial, cable and satellite providers) are still the most common way consumers are watching video, the momentum behind streaming content from the Internet is reaching critical mass.
Take a look at the statistics: According to the Consumer Technology Association’s (CTA) Video Consumption Trends study (December 2015), in the past year, one in 10 consumers ‘cut the cord’ by canceling their service provider subscription. And another 21 percent report having cut the cord over 12 months ago. Meanwhile, according to a TV Share of Clock study released last year by GfK MRI1, more than a quarter of television viewing time is spent streaming video.
Consider this: Netflix, the current king of the streaming hill, did not offer any streaming service until 2007. By 2011, Netflix began acquiring original content – the same year digital retail giant Amazon added Prime Instant Video, streaming as an add-on benefit to its Amazon Prime membership. In 2013, Netflix presented the critically acclaimed House of Cards, making an entire season available to viewers on Day One. The following year, Amazon began producing original content for its streaming platform, and this year began offering a monthly subscription to a streaming-only service to compete directly with Netflix. Today, with 87 percent year-over-year growth in audience tune-in, Netflix is equivalent to the third-largest broadcaster in the U.S.2
While these two relative newcomers to the TV landscape battle it out for streaming subscription supremacy, traditional content providers are addressing the cord-cutting trend by offering their own over-the-top (OTT) subscription services. HBO-Now, Starz, Showtime Anytime, CBS All Access, Sesame Street Go, Lifetime Movie Club and Crackle are among the rapidly expanding list of content providers with streaming platform options. The TV Share of Clock report also noted that 41 percent of viewers maintain their traditional TV subscriptions while also subscribing to three or more digital TV services online. CTA’s Video Consumption Trends study indicates that only 12 percent of consumers don’t plan to watch any streamed video content.
Opportunities for Accessories Sellers
So with a whole lot of streamin’ goin’ on, where are the opportunities for those in the business of selling consumer technology accessories? CTA’s research shows TV is the preferred device for viewing streamed programming, and the number of households with access to Internet programming on at least one TV grew by 75 percent from 2013 to 2015. Internet-enabled television, also referred to as “smart TV,” is an obvious play. As consumers wade deeper into streaming content, many will want to view it on their existing TVs that may lack integrated Internet capabilities. These customers have a wide variety of options for Internet access via set-top boxes like Roku, AppleTV and Amazon Fire TV.
CTA’s 18th Annual Consumer Technology Ownership and Market Potential Study (April 2016) shows 29 percent of U.S. households owned a digital media streaming device in 2015, but 15 percent (over 17 million households) intend to purchase such a streaming device in 2016. Lower-priced streaming “stick” products are also available from many of the same brands with slightly reduced feature sets but plug directly into a TV’s HDMI port. Google’s Chromecast and other similar products allow users to stream content from PCs and mobile devices to TVs with an HDMI input. TiVo and some set-top boxes supplied by cable and satellite service providers offer the best of both worlds with the ability to time-shift programming recorded to a DVR, as well as stream content on demand from Netflix, Amazon and other OTT subscription services.
Nielsen data indicates that traditional TV viewing time among 18-to-24-year-olds dropped by one-third between 2012 and 2015.3 Defy Media, a top digital producer and programmer for 13-to-34-year-olds, published research showing the average youth consumes nearly 21 hours of digital video per week. Millennials and younger viewers are more likely to watch streaming video on a non-traditional device such as a smartphone, tablet or personal computer because of mobility and content accessibility. There is no shortage of fashionable and functional accessories available for these mobile devices. Everything from protective cases and screen covers to external battery packs and headphones keeps these consumers in motion as they consume more and more media on the go.
And of course, most of these devices will rely on a good Wi-Fi router to connect to the source of the content stream. The newest routers have much faster data transfer speeds, as well as wider channel bandwidth. Recommend 802.11ac protocol routers to customers that want trouble-free streaming.
As they say, “Come on in, the water is fine!” The digital media stream is full of entertainment and opportunity. All indications are the market will continue to warm up and make for a very pleasant swim ‘downstream’ toward the future of video consumption.