Online streaming video is huge. It’s become a gargantuan industry that cable providers and networks alike are having a hard time competing with. Including ad-holders that buy the advertisement space during commercial breaks that pay for your favorite prime-time shows.
Many of those shows are eventually ending up on Netflix – the internet’s #1 streaming video company. While it’s not technically considered a cable provider (yet), since its establishment in 1997, Netflix streaming devices have replaced cable boxes in many homes in multiple countries. Netflix allows for some serious binge-watching of an ever-growing number of movies and series without a single commercial break to interrupt.
They’ve even started producing their own shows, with both the politically entangling House of Cards and also Hemlock Grove, which will wet the appetite of vampire/werewolf crowd, seeing viewer numbers in the millions, they’ve seen unbelievable overnight success (especially since they released all episodes at the same time, actually allowing you to watch an entire series in one day – again, binge).
The best rebuttal cable companies have come up with is the DVR and a limited array of on-demand material. But can they really compete with their limited storage space and the endless annoyance of having to still fast forward through commercials against the uninterrupted pleasure of Netflix growing library? As of yet, Netflix has been able to avoid signing advertisers to add to their revenue stream, but for how long? For now, Netflix has coined the online streaming market, but their method is most definitely the future of television entertainment. It’s only a matter of time before more companies follow suit and everything you can think of is just a search menu away and instantly accessible from your tv. Even now you can find just about every film or television show online somewhere for free (though we don’t advocate piracy).
If Netflix’s method is indeed the future of entertainment, and we believe it is, then it won’t be long until some competition pops up. Sure, they already have streaming competition in the form of Hulu and pirated-material websites, but at this point their numbers can’t even contend.
So where does that leave advertisers? If the Netflix method takes center stage in how we receive our entertainment, then your favorite tv shows won’t be considered prime-time any more, but instead they’ll be waiting for you to simply push ‘play’. When those coveted advertising twilight hours are all but gone, what happens to the commercial, as we know it? We have a few predictions:
1. Online video marketing campaigns will skyrocket, because yes, video marketing is still the most effective method of advertising, and you can bet advertisers aren’t going to miss out on that opportunity and disappear silently in the night.
2. You’ll see more of your favorite sites littered with video ads or pop-ups that can’t be paused or skipped. Much like YouTube’s new practice of monetizing and advertising.
3. And yes, eventually Netflix and other future streaming providers will most likely succumb to advertisers. There may come a time they just can’t say no to all that additional revenue, especially if they’re no longer competing with box cable providers; who, in turn, won’t simply disappear into the static, but will also likely turn to the on-demand streaming content business model.
Netflix’s on-demand streaming business model is the future of how we enjoy and obtain our entertainment. And so far, they’ve cornered the market, and they’re only going to grow larger specifically with all of their new originally produced content (which so far is remarkably good). Oh, by the way, they’re openly traded, we’re betting on their stock!
Article by New Slate Films