After music and TV, where will the streaming revolution take us next?

TV 19

(Franck V., Unsplash)

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Farid Ben Amor


The Fourth Industrial Revolution has delivered a series of disruptions that will remake the way we consume media forever – and when it comes to distributing media, the most important digital transformation has been streaming technology, or the delivery of content over-the-top (OTT) of the internet.

Streaming makes it easier for us to receive the entertainment we want, where and when we want it, and to interact with it – all of which older broadcasting technologies have trouble supporting. It also brings us closer to one another and helps us feel more connected to communities of others who share our niche interests, no matter where we are in the world – provided they have a broadband connection.

Streaming is a truly revolutionary breakthrough, both in business and in society generally. In that light, it is worth taking a look at where it has taken us and where it will take us next – from music to movies and television, then video games, and – further on the horizon – towards virtual and augmented reality.

The streaming wars so far

The first streaming revolution began with music. For better or for worse, digital transformation came for the music industry first – and enabled listeners to circumvent piracy laws almost immediately, although not completely.

 This century has witnessed a revolution in the way we consumeo music

This century has witnessed a revolution in the way we consume music – and there’s more to come
Image: IFPI / The Atlas

But weaning people off pirating songs from Napster and Kazaa took more than just charging them for the same experience. After all, it quickly grew tiresome downloading each individual song before it could be enjoyed. Instead, streaming enabled what appears to be a permanent shift away from physical music ownership. Platforms like Spotify and YouTube offer nearly any song ever recorded instantly, perfect for catering to fleeting whims and moods. Consumers are clearly shifting, and businesses are making peace with that move by charging for continual music rental via subscriptions or licensing for a share of advertising revenue instead of collecting one-off ownership fees. And as music industry revenues have started to creep up again, the first streaming revolution is settling into a lasting ceasefire.

Movies and television are currently in the throes of the second streaming revolution. Up until now, larger file sizes and patchy broadband reliability have stymied any mass migration from traditional broadcast services towards streaming platforms. Instead, online video growth has been much more linear. Nonetheless, the benefits of streaming video are now clear to every major studio, each of which has launched – or is about to launch – their very own OTT services.

The benefits of this new model are being felt not just by consumers, but by the television industry, too. Like the music industry, TV companies can reduce their reliance on charging us directly, and instead charge their advertisers for more efficient placement, deduct their fees from our latest purchase on Amazon, or monetize other forms of sponsorship. Now that content creators and distributors are beginning to embrace the newfound revenue opportunities offered by streaming, we will soon see even more ways to connect with our favorite movies and TV shows at lower costs.

The first two streaming wars have not come without casualties. Ensuing legal battles and unsettled political questions remain. Now that music and video have passed the tipping point – where the majority of these media are now consumed digitally – many have called into question what obligations these companies – the new arbiters of media access – should have. After all, it was policy provisions like ‘safe harbour’ that allowed major internet platforms to perhaps unduly monetize content that they didn’t own or license, which the new European copyright directive seeks to address.

Further, new privacy laws in California and Europe also question the proper value for the exchange of our data, and calls are increasing to expand our human right to receive media, enshrined in Article 19 of the Universal Declaration of Human Rights. Since music and video streaming account for the majority of internet traffic, many people are now looking to apply the policy framework for radio and traditional television broadcasting – which has been developed over decades – to mature internet platforms, while others are seeking to break them up. Whatever the political approach, it’s clear the second streaming revolution will bring about more policy changes than the first.

 This year saw the tipping point - when more of used the internet to watch videos than traditional TV viewing

This year saw the tipping point – when more of used the internet to watch videos than traditional TV viewing
Image: Zenith Research / The Atlas

What will go over-the-top next?

The third streaming revolution – video games – is about to get underway. In some ways it has been a massive streaming business for years, first with online multiplayer games and then with large audiences streaming live videos of gameplay. But the streaming of gameplay itself is coming. While there have been ongoing efforts to stream gameplay to any screen via the cloud, recent announcements by Microsoft, Sony, Google, and Electronic Arts demonstrate an industry-wide push to make streaming a real alternative to downloading games. And, much like television before it, partnerships between top game platforms such as Microsoft and Nintendo designed to enable users to access game subscription services within each other’s ecosystems (also known as ‘cross-play’) signal a vital precursor for the sustainability of game-streaming platforms. Think of it as like the time Netflix first offered popular movies from a wide array of movie studios on its streaming service thanks to its 2008 deal with Starz, or when studios opted to co-invest in Hulu and offer their content directly to a streaming service.

More generally, the similarities between the streaming revolutions in both games and video are becoming increasingly pertinent. While the popularity of video game content has long lived in the shadow of the larger audience sizes enojyed by television and movies, the increasing intensity of audience engagement with games through platforms like Twitch and titles like Fortnite has led some of the top sellers to generate more revenue than the top movies at the box office. Video games are now on course to catch up with video streaming as the highest usage of global internet traffic. This transition will likely be aided by increasing demand for esports combined with the launch of 5G mobile networks. These factors stand to make the coming games streaming revolution as economically significant as that of television.

Today the internet is showing us a lot more than just cat videos

Today the internet is showing us a lot more than just cat videos
Image: Sandvine 2018 Global Internet Phenomena Report

As for the next higher-bandwidth media applications, the stage is now set for virtual and augmented reality to exploit the accessibility of streaming and make real what was once science fiction. Just as successive media platforms have brought us closer to content – from radios, to television sets, mobile consoles, head-mounted displays and beyond – the intensity of our engagement has correspondingly increased.

Distributing content through streaming makes that process seamless – it increases the proliferation of content by making it easier to consume. There will certainly be other concerns around social and economic harm the way there have been for each prior iteration of disruption. It was once feared that addiction to the novel at its inception was one of the principal causes of hysteria. But these issues will either similarly be debunked or resolved and ultimately outweighed by the greater social impact of increasing connectedness, allowing us to overcome our respective physical surroundings and to build a more empathic world – all of which is to come when the fourth streaming revolution is upon us.

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