Netflix shareholders may not have been too happy with their latest results– but Ofcom has some better news for the accountants at Los Gatos, which might silence the bears who think the end is in sight for the streaming service.
The annual Media Nations report shows that the number of UK subscribers to the three main streaming services – Amazon, Netflix and Now TV – is now 300,000 higher, at 15.4 million, than the number of pay TV subscribers.
A British aggregator is almost an official government idea
Sharon White – Chief Exec of Ofcom – thinks she can see the writing on the wall. She is calling for a step-change in how British broadcasters work if they want to keep up. In fact, she wants to see the BBC, ITV and Channels 4 and 5 work together to compete in the global streaming market.
“I think it would be great to see a British Netflix”. But would it ?
The other key finding from the Ofcom report is that those attractive 18-34-year-olds (much desired by advertisers for their disposable income and capacity to lock into brands for life) are abandoning broadcast TV and its catch up services for solely SVoD platforms. Fully 54% of their viewing is now on YouTube, Netflix, Amazon and so on. Anyone who knows a teenager will confirm that they often barely know anything the BBC and Channel 4 are transmitting in any given week.
So those of us who grew up with a maximum of 5 channels, still feel a loyalty to Auntie Beeb and her British peers, want to see them compete against, rather than just distribute through the VOD platforms. But for the next generation, have the Public Sector Broadcasters already lost the battle ? The median average age of viewers of BBC One, BBC Two and ITV is now over 60.
It's about what shows you have
Those who’ve been raised in a digital age just don’t see the point of worrying where a show comes from, so long as it’s good and they can watch it where and when they want to. They don’t want to have to wait for a scheduler to decide the next series is worthy of a 9pm primetime slot, or wait for a series they aren’t interested in watching to finish to free up a slot for something they do want to see.
The SVoD platforms don't have that problem. They can throw out as many entire series as they want, whenever they want to. And whenever you watch something, it gives them another crucial piece of information about your viewing habits to add to their data mountains that can ensure you’re marketed to in just the right way.
Other international players are already much further down the line in entering the market (Disney to name but one behemoth), so do we really need a British one size fits all PSB streaming platform?
And if we do, who’s going to pay for it ? Even combined, could the spending of our four PSBs ever really create a global service to rival Netflix (still substantially in debt), Disney (with the Magic Kingdom’s billions) and Amazon (the world’s third most valuable company after Apple and Alphabet (Google) ?
We've been here before
It could all have been so different - if the competition commission hadn’t killed Project Kangaroo ten years ago, when Netflix wasn’t even a twinkle in Reed Hastings’ eye.
That was a valid British aggregation platform in streaming video that would have been ahead of its time. If it was brought back to life - now it would be hopping along well behind the action.