Emerging Business Models Reshaping the Entertainment Content Landscape

As the world begins to emerge from the pandemic, a new study from Futuresource Consulting shows that the consumer relationship with entertainment content has evolved. The firm’s latest wave of Living With Digital market research points to a growing consumer acceptance of emerging business models, including Premium Video-on-Demand (PVoD), Premium Electronic Sell-Through (PEST) and Advertising-based Video-on-Demand.

PVoD and PEST on the Rise, though Cinema still Significant

The study, carried out with 15,000 consumers in December 2021, shows a growing acceptance of early transactional digital releases in all countries surveyed, as cinemas re-open and the flow of movies once again reaches the big screen. In Europe as a whole, there is still a significant majority that prefers to watch their movies in the cinema, although this preference is much closer in the USA.

PVoD and PEST users are much more likely to be cinema goers as well, suggesting a beneficial co-existence, although the survey highlights some differences in preferences of where and how to watch new release movies, depending on the genre.

Streaming Services Showing Strength, though Churn a Concern

“Subscription services continue to capture the attention of consumers,” says Sidebottom, “with SVoD strengthening at the end of 2021 and into 2022 in many countries, after a more challenging year. Yet, in the core countries of the USA, UK and Germany, many SVoD subscribers told us they will be cancelling and restarting their services more often this year than previously. In the USA and UK, 45% of SVoD subscribers told us they cancelled an SVoD service in 2021.

“Despite this increase in SVoD service portfolio management, most take a new service with a view to keeping it for a while. There are also a number of different scenarios playing out on a country level, around whether consumers replace existing services or add to them when they subscribe to a new service.”

Ad-funded Content Improving in Quality

AVoD is also becoming a key component of the viewing mix, particularly in the USA, where half of all respondents confirmed that they use these services. Roku Channel, Pluto TV and Tubi are driving usage in the USA, supported by the likes of Peacock, Xumo and IMDbTV. Respondents in the USA also stated that the quality of content has generally improved over the previous six months, with the majority now watching movies on these services.

The latest Living With Digital report from Futuresource Consulting surveys more than 2,000 respondents in each of the seven countries covered, namely the USA, UK, Germany, France, Italy, Spain and Canada. For further information or to purchase the report, please contact leon.morris@futuresource-hq.com

About the author

David Sidebottom

David is a Principal Analyst – Media and Entertainment. David has over 20 years’ experience in a research and consultancy environment and is closely involved in researching, analysing and consulting on key content industry and consumer technology developments worldwide, with a particular focus on the evolution of digital business models in the TV, video and music industry. David works with a wide variety of high profile Futuresource clients across the content ecosystem including studios, broadcasters, technology companies, hardware vendors, service providers and industry associations. He also directs Futuresource’s long-running global consumer panel ‘Living with Digital’.