DEG Welcomes Futuresource Consulting as a Member | Meet James Duvall, Head of Entertainment

DEG Welcomes Futuresource Consulting as a Member | Meet James Duvall, Head of Entertainment

March 22, 2024 | DEG welcomes Futuresource Consulting, the specialist research and knowledge-based consulting company, as a new member. Futuresource’s insight and global market coverage are based on informed regional expertise, ensuring its portfolio of world-class clients is fully supported in research, analysis, strategic planning and decision making.

DEG recently caught up with James Duvall, Futuresource’s Principal Analyst and Head of Entertainment, to discuss how Futuresource expects the streaming landscape to evolve.

DEG: There is a lot of speculation about further consolidation among the largest content providers and distributors. How do you think this might change the streaming landscape in the next couple of years?

JD: In the world of streaming, whether that’s through subscription-based or ad-based services, capturing the attention of audiences is becoming increasingly challenging. Our latest “Living with Digital” study (which is a biannual consumer survey across 12 markets), has revealed that, for the first time, more consumers are planning to slow down their subscriptions to additional services. Many households have now reached a comfortable number they are willing to pay for and access.

In the larger markets, there will likely be enough demand to support the multiple subscription services that currently exist. However, in smaller markets, or in cases where customers cannot afford multiple subscriptions, we may see more merging of services or licensing of content to local providers.

DEG: All major content creators are trying to spend more efficiently, particularly on content creation. How will this manifest in the major studios’ D2C streamers?

JD: In recent years, the fight for subscribers has been fierce, with streaming services racing to add content quickly and efficiently to their platforms. While fresh content has always been a major pull for subscribers, a significant portion of this audience also values a large library of movies. According to our study, 20 percent of consumers said that a vast movie library is a reason they stay subscribed, compared to only 18 percent that cited original or exclusive movies. Services can do more to encourage consumers to explore the depth of their content catalog through algorithmic recommendations. This will ultimately help retain subscribers and balance costs.

With both more local content quotas being introduced and more short-term licensing of content from local film and TV makers taking place, services need to consider how to balance costs. This will further drive movement towards consolidation – particularly with local streaming services.

DEG: How do you see consumer churn trending in 2024 and how will SVOD services navigate this?

JD: Households are now reaching the limit in the number of services they’re happy to subscribe to. However, this doesn’t mean that they won’t hop between services to catch a new release. Over the past few waves of our research, the intent to cancel across the leading services has reduced, however we’re still finding that in some regions and across certain services, at least 15 percent of subscribers are likely to cancel within the next 6 months.

Ad-tiers have given SVoD services a great way to manage internal cost rises while having the dual benefit of reaching audiences with less disposable income. However, it’s also caused consumer loyalty to wane, with consumers now having an incentive to get their fix of content and then move on to the next service.

Audiences across the higher price tiers have come to expect high sound quality (for example, Atmos or spatial audio), full HD visuals, or multi-device viewing as part of their subscription. Now, subscribers will be looking for the next selling point to set apart one service from another.

DEG: Netflix is leading the industry in integrating gaming into its service. Do you think other major services will follow suit and if so, when, and how?

JD: Disney’s investment in Epic Games provides them with the perfect partnership opportunity to develop their direct-to-consumer (D2C) service. Warner Bros. Discovery also boasts a strong heritage of intellectual property (IP) through their WBIE games division – however, I don’t see any progression in this area being immediate, nor is it likely to follow Netflix’s approach.

Bringing new initiatives and a solid mix of content delivery is vital to customer acquisition, but all services will be striving to ensure they don’t dilute the quality or the user experience.

DEG: What are your favorite movie and TV genres, and why?

EB: After a busy day and week, I like nothing more than a good action or sci-fi film for a bit of escapism. When it comes to TV, I find a great comedy to be the perfect pick-me-up. I have enjoyed watching Jack Reacher on Prime and The Bad Batch (pictured) on Disney+, getting through both as soon as episodes were available. I make the most of any TV-time I get with my daughter, especially when she’s not multi-screening! We usually enjoy catching up with the latest reality TV show, particularly Gladiators and The Masked Singer.


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