Time for the 2020 version of our TV[R]EV Annual Predictions.
(But stop me if you’ve heard these before..)
1. The Content Glut Gets Nasty: Remember the giant squid in Watchmen, the one that kills three million people when it lands? That’s sort of what the upcoming content glut is going to feel like. Minus all the death, anyway.
But yeah, people are going to feel like someone dropped a giant squid on them.
You can see it already, all those conversations about what you’re watching, what you should be watching and which service is that actually on.
Only it’s going to get a lot worse.
A whole lot worse.
Netflix, Amazon and Hulu have a mess of new shows coming out this year. But so do Disney, Apple, Peacock, HBO and VCBS. Like $20 to $30 billion worth of new shows. (The numbers change pretty frequently and it’s hard to nail them down.)
When all these shows are getting released at the same time, then it’s blink and you might miss them. Even if it’s a show you really wanted to see. (Worse still if it’s on Netflix or Amazon where the entire season gets dropped on a single day.)
As a result, a lot of really good shows are going to get lost in the shuffle, especially if there’s not enough ad budget behind their launch (and with the billions being spent on originals this year, chances are high there will never be enough ad budget.)
Having so many choices is not going to make people happy.
People want TV to be something they watch to relax. They do not want the mere act of deciding what to watch to stress them out.
Which leads to prediction #2:
2. Analysis Paralysis Leads To A Return To Linear: Analysis Paralysis is the pop-psych term for what happens when people have too many choices and thus get so afraid of making the wrong decision that they just shut down.
That’s what I think is going to happen with a lot of folks—they are going to get so overwhelmed by all the choices on streaming services that they’re going to freeze up and start looking to either the FASTS (Free Ad-Supported Streaming TV Services like Pluto and Xumo and the Roku Channel) or to actual linear TV itself as a way of avoiding any sort of actual decision making.
We may also see the various Flixes creating their own forms of linear playlists, based around topics (“Crime Dramas”, “Family Comedies”, “Sports News”) that start and stop when you do and so you’re never tuning in during the middle of a show. (Netflix has kinda-sorta been playing around with this.)
It’s part of what I called the “Spotifyization of Television” in my book Over The Top a few years ago. That was based on Spotify’s discovery that its radio-like Daily Mixes were so popular because users were overwhelmed by having to pick their own music every day and were usually happier to let someone else do the picking for them, especially if that someone else mostly got it right.
So don’t be surprised to see personal playlists cropping up on linear feeds.
I mean it’s not like they haven’t been tracking what you’ve been watching all along, right?
3. Recommendation Engines Will Be The Next Hot New StartUps. Given all the confusion out there, an app that promises to tell you what to watch next seems like an easy win and I suspect there will be many start-up apps based on that very premise.
Unfortunately, I’m not sure they’re going to work.
People are complex creatures and just because someone liked BoJack Horseman doesn’t mean they’re necessarily in the mood to watch another cynical animated comedy series. They may in fact be up for a documentary, only they won’t realize that until they stumble on to something about the sad history of the Anabaptists in Reformation-era Switzerland that piques their interest.
Then there’s the fact that people will often watch shows that their friends and family recommended, if for no other reason than it seems polite and it gives them something to talk about.
Regardless, once the user starts to feel that the app is screwing up (and eventually they will) it goes into the “no longer use” pile and that’s the end of it.
Sort of like what happened with Second Screen.
4. Cord Cutting Finally Starts To Happen: As you’ve no doubt heard me say many, many times, the “massive wave of cord cutting” has mostly been a myth, something the trade press uses to drive clicks. But that’s about to change, post-Flixcopalypse, when viewers look at the cost of all the subscriptions they’re paying for and realize that the subscription that is costing them the most money is the one they are spending the least amount of time watching.
So look for more people to start dropping out of the traditional cable pay TV ecosystem this year, though nothing even remotely approaching a “massive wave”— the current 1% to 2% drop may turn into 5% or 6%.
Most of that will be directed at all the smaller and less popular cable networks, the ones viewers never watch and couldn’t even begin to tell you what was on them.
So not HGTV or CNN, but the hundreds of other random cable network, most of which will be best served reverting to a studio-type model and feeding programming to the various Flixes or FASTS.
5. The Launch of Super-Skinny Bundles: In response to an increase in cord cutting and decrease in interest in large multichannel bundles, MVPDs and vMVPDs will launch a series of low-priced “super skinny” bundles, consisting of just the broadcast networks. Sports and news will be available as add-ons.
Sadly, most of them won’t. They’ll take the financial hit from all those lost pay TV subs and try and make up the revenue by jacking up their broadband rates. Because until 5G happens, they still pretty much have a monopoly on broadband and it’s an easy win, since broadband is more or less pure profit for them, plus they still believe that getting people to subscribe to pay TV makes them stickier and all that, so they’re not all that excited to give pay TV up.
OTOH, many of the smaller MVPDs will get out of the pay TV business altogether, offering their subscribers a combination of broadband and vMVPD options.
But as the number of cord cutter continues to rise, super skinny cable packages, especially super skinny cable packages bundled together with and couple of Flixes, will come into style.
6. The Great Rebundling Begins: If there’s one thing we can be certain of, it’s that there will be massive churn amongst the various Flixes as viewers subscribe and unsubscribe in order to both check out new services and save money on the ones they’re not watching that month. Not every viewer—people are still mostly lazy, especially about bills under $10—but enough to make churn a significant issue.
And so we will see the Great Rebundling begin.
Mostly it will happen via the MVPDs and vMPVDs, who will offer discounted year-long subscriptions to various Flixes along with their standard pay TV package. And let’s be real—they’re good at that. So look for “$99 for 200 channels plus Netflix, Disney+, Hulu and HBO Max!!” style deals, where the fine print reveals that the price is only good for the first three months of a 24-month contract, after which it goes up to $129/month.
You’ll also see the aforementioned Super Skinny Bundles, where a lower price (say $39.99/month) gets you 10 cable channels and five Flixes.
To start off with anyway.
The other two Great Rebundlers will be device manufacturers like Amazon, Roku and Apple, who may even include a free device as part of a larger subscription bundle, and the Flixes themselves, who will offer full year subscriptions via their apps for, say, 20% off the price of a month-to-month subscription.
Because they need to be able to promise a consistent audience size to advertisers.
7. It’s All About The Shows. You know all those Influencers who spew out cliched aphorisms like “Content Is King!” Well they’re on to something. Because in the Battle of the Flixes, it is one hundred percent (sorry Sahil) going to matter who has got the best shows.
Now of course “best” will vary greatly depending on which audience you’re talking bout, but there will be one Flix, maybe two, that will capture the hearts and the minds of the coastal elite, the people who actually write reviews about TV shows and give them Emmys and Golden Globes.
That Flix will be deemed the “hot” Flix by people who do that sort of deeming and there will be a spate of articles as to why they are so hot, with gushing profiles on the hotshot young programming executives who managed to tap into the gestalt and all that.
But since audiences are not monolithic, none of the other Flixes will be in any real danger of going under. No matter how many times someone writes about a “Netflix Killer.”
(At least not in 2020. A Flix would have to do something really catastrophically awful for it to go under this year, and I just don’t see that happening.)
8. FASTS Go Fast. Given the news about Comcast’s likely purchase of Xumo, this isn’t all that tough to predict. Should that deal happen, it leaves Tubi as the last of the independent FASTS (versus the ones owned by Amazon and Roku) and there are a host of potential buyers out there for Tubi, which is now international.
FASTS (Free Ad-Supported Streaming TV Services) are attractive because (a) they’ve figured out how to stand up an ad-supported OTT platform that seems to be in good technical working order, and (b) because most of them have figured out a way to make linear streams a part of their platform, and TPTB are starting to realize that linear is going to be a part of streaming TV’s future. (See Prediction #2)
9. 5G Is Still Largely A Pipe Dream: Yes, it’s being rolled out this year. But slowly. Very very slowly. There are towers to be installed, neighborhood associations to be mollified and then Verizon, AT&T and T-Mobile will need to go out and actually you know, market it.
They’re not going to make much money on 5G iPhones–the real money is on 5G home broadband with wireless modems and that is still a few years away from achieving any kind of scale.
When 5G does happen, it will shake things up, if for no other reason than there will finally be real competition for broadband, which, until now, has largely been a monopoly or duopoly delivered via the various cable companies.
But 5G as widescale broadband replacement is more likely to be a 2023 thing, than a 2020 thing so don’t place your bets just yet.
10. Addressable TV Advertising Gets Scale After reading the new TV[R]EV Special Report on Addressable TV Advertising, brand managers nationwide press their agencies to “get us some of that addressable advertising everyone keeps talking about.”
Okay, not really, but it will start to take off this year.
Both Project OAR and Nielsen are going to introduce addressable ad overlays for linear network TV (it’s all explained in the report) and that is going to increase the amount of addressable linear inventory that’s available, which will be significant, but nowhere near as significant as the amount of VOD (OTT) inventory that becomes available with the launch of all the Flixes and the continued growth of the FASTS.
By combining all that with existing MVPD addressable, advertisers will finally be able to get something that looks like scale, though actually buying it will, as noted by Mike Shields earlier this week, continue to be a hassle and then some, which will put a damper on all the enthusiasm around it.
• Quibi Will Pivot To TV. Once they realize that no one wants to watch Video You Need To Pay Attention To on their smartphones, Quibi’s founders will launch apps on Roku, Amazon, Apple TV, VIZIO, Samsung et al, that allow people to watch Quibi shows on an actual TV set and to watch them all in a single sitting to boot. And it will succeed where the mobile app did not because viewers will quickly realize the appeal of a well told story that can be watched in a single 100 minute viewing session rather than the eight to ten hours the new Flix shows are demanding.
• Fake Stats Will Continue To Be Gobbled Up By The Press. Whether it’s a survey of 134 people that is presented as “proof” that viewers only want four streaming services or a prediction that the OTT market will “grow by 68.73490459%” in 2020, “adding $20,342,512.67 of additional revenue”—specious stats and surveys—especially those with infographics—will continue to be presented as truth by unsuspecting media outlets, and their infographics will be incorporated into numerous Powerpoint decks. That’s because there’s nothing people like more in a time of great uncertainty than a heaping dose of certainty, and truth, or the fact that someone more or less pulled those Very Certain Predictions out of thin air, is not really something that concerns them.
• Social Media Decline Creates An Opportunity. The 2020 election will make 2016 look like amateur hour and users, who are already turning away from the platforms, will become even more put off and distrustful, to the point where they start avoiding those platforms as much as humanly possible.
This then creates an opportunity for someone to come up with a replacement for the things many people still rely on Facebook for: planning events and running groups (school PTO, alumni association reunion, family vacation planning, etc.) that tend to be Facebook’s sweet spot.
At least with users over 40.
That’s all I’ve got. We’ll see how accurate this looks a year from now. Regardless, 2020 promises to be a year of major changes and TVREV is there to help.