TV one tipping point closer to total disruption
No sooner had SAI Business Insider kicked up an internet storm the other day by claiming the “TV business may be starting to collapse”; numerous recent reports suggest on-demand, non-TV-set viewing is overtaking scheduled viewing; and the rumour mill is running full whack on what TV plans Apple has up its sleeves than traditional TV got another kick in the teeth, from IHS Screen Digest.
The analysts’ latest report shows that Netflix has overtaken Apple’s iTunes in US VOD (video on demand) revenues. And perhaps the most arresting part is in the above chart: it has done so in just over a year! Netflix’s 2010 market share was 0.5%; in 2011, it had jumped to 44%, surpassing Apple in one fell swoop.
Furthermore, the streaming firm is leagues ahead of its competition: Hulu, its closest - and major-backed - competitor, is ten times smaller than Netfllix in market share terms. But others are snapping at its heels: Vudu, Wal-Mart’s Netflix-like service, has seen its market share triple of late.
No doubt the most exciting part of all this is the shift in media consumption we’re in the midst of right now. Download vs. streaming debates are currently rife in music too, and as they frequently point out, downloads - the iTunes paradigm - aren’t actually that different from selling DVDs or CDs. You pay once, you own the media, and the creator is paid once.
With new models such as Netflix or Spotify, you constantly pay a flat rate, and creators are paid - albeit no way near as much - for every play. It’s a massive change, and, as Screen Digest’s report shows, it’s now become the dominant model.
All eyes will as such be on Apple at its imminent developers’ conference. The TV app environment it is expected to unveil will at least grab the company back some content-distribution cred; but none of us will really be happy until we have our shiny new, all-in-one iTV.
With a Netflix app, of course!