Streaming services have immensely altered the entertainment landscape. In the recent past, television shows and movies could only be watched at specific times and then disappeared soon after. However, this is no longer the case due to the revolutionary product package established by Netflix. It has emerged as one of the fastest entertainment companies today. It boasts of more than 150 million subscribers in nearly 200 countries all over the world (Ewing, 2019). Netflix has created a business ecosystem on the always-accessible streaming service, which allows viewers to watch any television show or movie they want, at the time of their convenience.
Part of the great reason for the massive popularity in streaming services rests on the fact that the millennial generation has several ties with traditional operations. Been the largest segment of the population, they dictate what is fashionable in the market. Streaming services are one of the trendiest products in the global market and have altered how firms in the entertainment industry are conducting their business. As a result, some companies that will not have changed to this business model are likely to be swept away as a result of new and disruptive innovation.
The Industry that Will Grow
The streaming services use a lot of bandwidth; hence, for companies that provide and those that own undersea capable, the movement in this direction automatically implies more business for these companies. However, a company that is poised to climb on even greater heights in the future is Netflix. According to Ewing (2019), among individuals who stream for content online, 42 percent of them are generation X, who are between the age of 35 and 54 years, while 39 percent of the streamers are aged between 18 and 34 years, the millennial. However, it is astounding to learn from Ewing (2019) that a majority of the streamers are single, 60 percent, and 80 percent and lives in urban areas. The statistic quickly implies that the thinning of the rural areas in favor of the urban could improve the need for streaming services all over the globe.
Examples of Existing Firms to Benefit from Global Trend
Streaming services have displaced power from the traditional television broadcast companies. Viewers are looking for convenience, as well as the affordability and personalization associated with the streaming services. Netflix, together with companies such as Amazon and Hulu, offers what the standard cable providers cannot, which is the unrestricted freedom and availability of favorite television shows and movies round the clock. After the spike in popularity of Netflix, TV ratings, and cinema attendances have spectacular fallen (Hennig-Thurau & Houston, 2019). Big broadcasters have followed suit and came up with their streaming business models, including HBO, ABC, Fox, and amongst others.
Netflix continues to revolutionize the market because its viewing platforms are unique from one user to the next. According to a survey conducted by CNBC and reported by Liesman (2018), more than 60 percent of Americans have been won over the streaming service. This report confirmed the fast shift to streaming service by households in the United States, increasing Netflix usage by double in the year 2018. This idea is supported by a report by Pew Research Center (2019), which reported that 61 percent of Americans between the ages of 18 and 29 prefer streaming services to cable, at 61 percent and 5 percent, respectively. Its success shows the pressure in obsolete technologies and cable providers because of the stiff competition. Netflix allows its consumers to select what to watch from a massive library of videos and shows, and after that, streamline the search for a specific user (Dasguptaand & Grover, 2019). For instance, when a consumer logs into his or her account, he or she has a complete profile that is showing what one has watched together with possible recommendations based on the preferences of previously viewed content.
Recommendations for the Firms in the Industry
The transformation of the entertainment industry to streaming services is sped on by the thinning rural migration in favor of the urban live calls for greater interest in the industry, and especially among top players. With the growth of streaming services expected to increase in tandem with an increasing move of populations from the rural areas into urban areas, especially in the emerging market, Netflix will be forced into ownership of the undersea submarine cables to increases its bandwidth and reduce costs of operations. Higher capability to provide the service will mean more revenue and even higher value.
In the entertainment industry, streaming services have dominated today's society. Central to this development is the rapid migration of populations to urban areas. Easier access to high bandwidth speed in urban areas is fueling the growth. Netflix has grown in leaps and bound over the years and is still predicted even to become more as the rest of the world are moving from traditional methods of watching television shows and movies.
Dasguptaand, S., & Grover, P. (2019). Understanding adoption factors of over-the-top video services among millennial consumers. International Journal of Computer Engineering and Technology, 10(1), 2019, pp. 61-71.
Ewing, J. (2019). New research highlights streaming demographic trends. Retrieved from https://www.forbes.com/sites/jeffewing/2019/02/12/new-research-highlights-streaming-demographic-trends/#607e421560b2
Hennig-Thurau, T., & Houston, M. B. (2019). Entertainment distribution decisions. In Entertainment Science (pp.679-744). Cham, Springer.
Liesman, S. (2018, March 29). Nearly 60% of Americans are streaming and most with Netflix: CNBC survey. Retrieved from https://www.cnbc.com/2018/03/29/nearly-60-percent-of-americans-are-streaming-and-most-with-netflix-cnbc-survey.htm
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