Online-Streaming

Despite its slow rise in the 1930s, television has developed rapidly. Back in the sixties radio was replaced by TV and became a mass medium. Nowadays almost every household owns a television. Due to the digitalisation the user behavior has changed drastically. Above all younger generations tend to consume televison content on the internet, where it´s provided in media libraries, video portals and Video-on-Demand platforms.

History of televison

The first TV was presented at the radio show in Berlin in 1928. Until this point there was no television program launched. Only in 1935 the first channel appeared. At that time it was the only TV program available. When the Second World War broke out and Hitler came to power any attemps on TV were stopped and channels got banned.

In 1950 only a few households owned a television, since purchase costs were too high for the general public. In 1959 television considered as a leading mass and social medium. It was meant sitting together in the living room with family and friends and watching the programs. In 1991 the pay-TV broadcaster Premiere was founded. This was the first TV non cost free streaming service offering movies, live sports, documentaries and concerts. From that moment the new “TV”-generation was born.

More and more diversifications of video-on-demand offers were published on the market. Further streaming services that have been added in recent years are Maxdome and Watchever. The nowadays most common streaming services are Amazon Instant Video and Netflix. In Germany Amazon Prime is consumed by 47.4 % , followed by Netflix with 36.7 %. After the two acclaimed streaming services, maxdome, Itunes, Watchever, snap by Sky and others are following

One in four people are using on-demand portals. German internet users watch movies, TV shows or other videos online.

Popular portals are also media libraries of the TV stations, as well as paid platforms such as Netflix and Amazon Prime. An important issue is that those types of usage changed lately. That is why online streaming is shifting to smartphone or Computer. Even transmission channels and devices are changing, but television doesn´t. The reason for this change is, that younger people are using streaming platforms more and more. As a result of digitalization, streaming services, media centers and video portals were also able to broadcast TV´s content on the internet. Just because of digitalization a nationwide Internet offering was possible. Other reasons for more and more younger people to switch to online streaming are: online streaming is location-independent and series and movies can be watched at any time. The last reason for the change is the opportunity of invidual program planning.

I think there will be 20 years of evolution from linear broadcast to internet television.“

Reed Hastings (Netflix-Manager)

Television and Online Streaming

Sit in front of the TV and watch films and series with family and friends is still very popular in Germany. About 80% of the german population have a TV at home and uses it 220 minutes a day on average in 2016. But the younger generation is nowadays slowly switching from watching TV to using online streaming platforms like Netflix, Maxdome or Amazon Prime Video. In 2014 12 million people make use of these platforms and two years later (2016) number of users is almost twiced. You can utilize 38 different online streaming providers in Germany and nearly 43% of the germans are signed in one of these.

Bitkom has conducted a survey about this topic and the results are interesting. 25 % of all respondents can imagine to give up the classic way of watching TV. 51 % of all respondents watch less TV since Video-on-demand-proposition was launched, in 2014: 44 %. 63 % of the 14-29 years old people said they watch less TV,53 % of the 30-49 years old people said they watch less TV.

Because of this transition we have thought about some predictions for the future and how the world could possibly changed. The number of Video-on-Demand-User will be rising continually all over the world. Especially the younger generation will use the Video-on-Demand-Proposition more and more. The number of people, who watch TV in the classic way will fall continually, but not as fast as predicted. The product range will be rise very fast and the competition between the providers will also rise.

But we don`t have exactly the same opinion as Reed Hastings! We think that the classic way of watching TV won’t die in the next 20 years, because the resting time in front of the TV, especially in Germany remain constantly in the past few years (220 minutes). And a very important thing ist, that the TV-channels have a educational mandate compared with the Video-on-Demand-providers.

If the TV-Stations don`t want to loose more and more viewers, they have to develop. They need a bigger online proposition, a diversified programme, a target-group-specific programm and a bigger presence in social-media.

It‘s obvious that transition from traditional TV to digital streaming is happening. Today, two main video services: video-sharing (like Youtube, Vimeo) and video-on-demand platforms have become a part of our daily media usage. In some ways, we could think about both of them as an equivalent for traditional TV. However, it‘s more than this.

New type of celebrities

While VOD (video-on-demand) services provides us original series and movies, platforms like Youtube brings in totally different experience for audience, because viewers here are the sames ones who create content. Here, user-generated content totally changes the meaning of celebrity and redefines traditional TV celebrity path.

If to appear on TV screen was something only VIP and the luckiest talented people could do, now everyone can become a famous persona with the right audience-targeting and persistent Vlogging. That‘s how today we have celebrities like PewDiePie, a young man who became famous just recording his comments while playing online games or 24-year old Marzia Bisgonin who’s full time job is to make videos about what she bought in Primark today. The only way to become a celebrity is to be viewed, is to have people spend their time to watch your videos. Attention here is the new currency. It could be said that the same theory applies to VOD a ka video-on-demand services. But it‘s more complex than that.

How subscription based streaming platforms are revoliutionizing traditional TV principles

VOD as Netflix or AmazonPrime provides us exclusive content as TV series and movies in exchange of subscription based monthly fee. Why we feel attracted to subscribe? Subscription phenomen isn’t new at all, but now it is revived in totally new ways and areas. In this case, in a way it replaces long-term cable contracts with just monthly fee. Subscribing every month and having opportunity to cancel anytime gives us less of a feeling of obligation. What‘s hiding behind this? The option to cancel anytime is an silent obligation from VOD provider to satisfy its subscribers with the newest content all the time. Meaning that subscription itself is a strong promise of an everlasting improvement and movement of the services.

On the other hand, VOD subscription perfectly fits millenialistic nomadic tendency which encourages us to own less. All of the content is on the internet, we don‘t need to have the physical copies of TV series or a DVD of a film. And of course – no advertisements. We‘re paying for our uninterupted attention to watch what we choose to watch.

Community is important, social media is the king

Not less important factor which makes us want to become members of Netflix is the membership itself. It‘s a ticket for VIP club. For being in the community. For being able to watch same shows as our friends, and discuss them in social media. It‘s just the simplest sociological approach – our need to belong somewhere.

Netflix played this card very well and its communication experts should be awarded for all of the buzz in social media which became a norm in this day. Netflix invented new concepts such as binge-watching and series marathons or making go viral things like „Netflix‘n‘chill“ which became a metaphor for having sexual intercourse.

Quality content for majorities and minorities

In VOD platforms where there are absolutely no rating reports or advertising blocks to sell, mass popularity isn’t defined in the same way (as in TV) or even that important altogether. Besides making quality TV series which users can exclusively watch only on the platform, finally there is an opportunity to create very niche-oriented content. VOD can center not only on huge crowds and main interests, but also on small, but dedicated audiences that can’t watch nichey stuff on TV because it’s not financially worth for big TV providers. Good example is comedy shows – it’s quite obvious that humour is something very subjective and what’s working for one audience, won’t for another, but that doesn’t mean that particular comedy show is bad.

More freedom in content means more freedom for TV writers. And less censorship online plays a huge role in this. It gives more freedom of speech to explore sometimes taboo topics like LGBT, refugees and racism that can‘t that freely explored on TV.

What future holds?

All of the described factors are shifting consumer behaviour to another level. There‘s a big probability that new phenomenon of smart subscription will arise. This means that majority of media users will be willing to pay money for better development, better content and quality in programmes. It will definetely result competition between biggest VOD service providers and the social media will be their war field.

For the production itself, VOD providers may arise as producers and TV series buyers. It already started – some TV channels already are selling their low-rating TV series just because there was not enough of audience. It happened for NBC Universal as their „Unbreakable Kimmy Schmidt“ couldn‘t break it on TV, Netflix bought it and sucessfully found an audience in their subscribers list.

Katharina Merz, Max Kandler, Austeja Nedzveckaite