GlobalData: Netflix set to see effect of higher competition pressures | Media Analysis | Business | News | Rapid TV News
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Even though it remains the undisputed leading streaming platform, with a 21% share of the US subscription video-on-demand (SVOD) market in 2021, Netflix is showing signs of slowing and, says analyst GlobalData, is going to see an even more challenging 2022.
GlobalData 17Jan2022
According to the analyst’s study report: Tech, Media, & Telecom (TMT) Predictions 2022 – Thematic Research, with more and more competitors arriving, all streaming platforms and in particular Netflix, will not only have to provide evocative content but will also have to find an effective niche or build partnerships with other entertainment providers to become an entertainment all-rounder and stand out in the crowd.

This was evidenced, said GlobalData, by the launch of Netflix Games in November 2021 and the company announcing a co-streaming partnership with Twitch.

“Subscribers can look forward to having a more rounded service and seeing large franchises converted into shows. This may, at the same time, leave subscribers torn between different platforms,” commented Francesca Gregory, associate analyst at GlobalData. “Besides partnerships, content portfolios will be the key determiner of any streaming services’ survival moving forward, and strategic content spending will be essential for streaming services to retain their market position.”

The analyis also predicted that as the number of streaming platforms increased, and the market approached peak fragmentation, SVOD platforms would use content portfolios to differentiate themselves. It added that the trend of huge content spending would likely continue, with franchises that are likely to attract a loyal fanbase standing to benefit in the next year. Example cited were Amazon committing $1 billion on its Lord of the Rings series before a single episode has hit viewers’ screens and Paramount+ aiming to serve what it called long-neglected Gen X audiences with its content selection. The result is likely to be that companies failing to secure a market niche would have a limited shelf life in the crowded SVOD market.

“The ‘all you can eat’ business model has proven popular with streamers so far,” Gregory concluded. “However, this means that to grow revenues, streaming platforms will need to seek new audiences. A series of strategic partnerships between video streaming, gaming, and podcast companies will take place.”