Entertainment forms a critical component of our daily lives. We go through a range of experiences every day which generate a thunderstorm of feelings, emotions, thoughts, and ideas within us. While some are pleasurable and exciting, majority of them lead to stress, anxiety, and a wide plethora of negative emotions. Dealing with such situations adds to our already overburdened mind and body and as a result, we seek means to escape the real world, even if it is for a short while. Films, TV shows, and other visual content provide us these make-believe escapades.
In the olden days, people were heavily reliant on radio shows and televisions to fulfill their entertainment demands. The entertainment world has undergone a sea-change since those simple times. Today, visual content can be accessed through smartphones and laptops owing to the emergence of over the top (OTT) service providers such as Netflix, Amazon Prime, Hulu, and many others. So lucrative is this domain that Fortune Business Insights™, a renowned market research firm, projects that the global over the top (OTT) services market size, which currently stands at USD 30.23 billion, will reach USD 86.80 billion by 2026, soaring at a CAGR of 14.3%.
Evolving Consumer Tastes: Structural Shifts in Content Demand and Viewership
There has been a gradual but noticeable shift in content demand and viewership among young populations worldwide. According to an article published in the Indian newspaper Livemint, the millennial generation in India is increasingly opting for watching their favorite content on the internet as they can access it at their convenience. In the US, a survey conducted by the Pew Research Center found that approximately 61% of young American adults surveyed between the ages of 18 and 29 stated that their primary source of television is streaming services on the internet. This evolution of taste can be boiled down to three factors working in favor of OTT services: flexibility of accessing the desired shows and films, want of quality, novel, and relatable content, and absence of regulation on the material created on OTT platforms. The last point is especially pertinent in India, where content regulation and moderation through censorship laws has deprived Indian youth from experiencing shows and movies with mature themes. As a result, streaming services are enjoying blistering sales and growth in the country because they are able to provide a platform for new-age creators to release their material online.
Understanding the Role of AI in Augmenting Streaming Experience
The OTT industry giants such as Netflix and YouTube are actively deploying modern technologies such as Artificial Intelligence (AI) and Machine Learning (ML) to augment the user streaming experience. Take the case of Netflix. The company is spearheading the adoption of AI, ML, and data analytics to personalize content recommendations to viewer as far as possible. The strategy employed by the company to achieve this involves a careful analysis of the content watched by other users who have similar taste as yours and to recommend material accordingly. Furthermore, it also generates thumbnails of movies and shows that you may have searched or streamed, identifies the points (actors, scenes, etc.) that you seem to be interested in most, and then customizes the thumbnails which you are most likely to click. This ensures that the viewer is constantly fed updates about any upcoming material relevant to the viewer, with an additional effort put towards promoting content produced by Netflix itself. AI, therefore, is transforming the streaming experience for users and providing the necessary tools to OTT companies to keep their viewers engaged.
COVID-19 and the Spiking Demand for OTT Services
The COVID-19 pandemic has forced large swathes of populations around the world to remain confined in their homes for an indefinite time period. With nationwide lockdowns and social distancing norms in place globally, the usual places of entertainment such as malls and movie theaters have been directed to shut down to contain the spread of the virus. Consequently, consumers have shifted to the next fungible mode of entertainment: online streaming. OTT platforms have witnessed an astonishing spike in demand as people are trying to escape the constant stress and anxiety caused by news relating to the coronavirus. According to an article published in the Financial Express (part of The Indian Express Group) in May 2020, Amazon Prime Video reported 67% increase in its subscription in India, while Netflix saw a rise in subscriptions of 65%. Globally, daytime video streaming reportedly went up by 20% and 30% in the Americas, as per the data analysis conducted by Conviva, an online video optimization company. Clearly, the COVID-19 outbreak has given the OTT industry a surprise booster shot.
Will OTT Providers Continue Their Success Story in the Upcoming Years?
The growth trajectory of online streaming service providers does not seem likely to flatten out just yet. Increasing young population, changing content preferences, and the ongoing coronavirus pandemic have ensured high demand for OTT services. Added to these factors is the growing number of people with access to high-speed internet and smartphones in the developing nations of Asia and Africa, where the OTT sales are surging. Furthermore, entry of regional players, such as Voot and Hotstar in India, is creating intense competition for the big players. Although it is highly improbable that OTT platforms will full replace traditional entertainment channels, the inroads being made by these services will significantly alter the dynamics currently governing the entertainment industry.
About the Author
Name: Shantanu Ayachit
Shantanu Ayachit is an avid enthusiast of the tech world and has experience in developing quality content for readers. He is currently involved in writing articles, press releases, and blogs on topics related to the world of technology. Highly motivated, he enjoys putting ideas and thoughts into words to enable the reader to experience a seamless perusal.