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Direct to Consumer 1.1 Video’s Big Bang Moment

Report by Tim Mulligan
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The 20,000 Foot View: 2019 marks the biggest shift in the US video market since Netflix’s pivot into streaming in 2007. Apple, Disney and AT&T-owned Warner Media are preparing for their direct-to-consumer XXX launches into the US market in XXX XXX 2020. How they fare will have a significant impact on the global evolution of video subscriptions. They will also provide the first serious domestic competition to Netflix, Amazon and the rising fortunes of Hulu’s blended subscription and ad-supported model. However, streaming video on demand (SVOD) weekly active user (WAU) penetration is flat, an early indicator of a peaking attention economy, so the new challengers need to maximise their unique selling propositions (USPs) to gain traction in a congested market.

Key Findings

  • Disney+ launches on November XXX with a strong international, ad-free, originals-focused growth strategy 
  • Apple TV+ launches on November XXX 2019 with a show-maker-led originals strategy leveraged by its iOS ecosystem
  • Warner Media will launch HBO Max in XXX 2020 with a focus on library and original content
  • NBCUniversal will launch Peacock – a TVE, AVOD hybrid with sports programming, in April 2020
  • Warner Media has the highest share of the most popular shows with XXX of the top ten shows in XXX XXX of US consumers have multiple video subscriptions 
  • SVOD penetration is highest among XXX year olds at XXX cutters have the highest fandom for Friends, the most popular US Show in XXX XXX of US Netflix subscribers have multiple SVOD XXX of US Amazon Prime bill payers have a Netflix account, down from XXX in XXX 2018, compared to XXX of Hulu subscribers, up from XXX in XXX 2018
  • Netflix’s subscriber hours declined between XXX despite a XXX increase in annual content expenditure in 2018 from 2015
  • Success for Apple and Warner Media will depend upon their ability to leverage their ecosystem advantages
  • Disney needs to use its brand equity to leverage its mainstream family appeal for Disney+

Companies and brands mentioned in this report:  Amazon Music, Amazon Prime Video, Apple Music, Apple, Apple TV+, AT&T,CBS, CBS All Access  Comcast, Disney, Disney+, ESPN+, HBO Max, HBO Now, Netflix, Spotify, Warner Media

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