How Streaming TV Services Can Stand Out as the Format Explodes (Guest Blog)
Finding a niche is key to surviving the OTT baby boom
Dan SchechterGuest Writer | August 10, 2016 @ 8:30 AM
Netflix, Hulu, Amazon Prime and HBO are among the over-the-top (OTT) TV industry’s biggest players, but there are substantially more options available, as we discussed in last week’s post, and momentum is only growing.
As the chart below shows, 2015 was a blockbuster year for OTT TV platform launches, and in looking at the those large enough to make a splash, we saw 35 new services vying for consumer attention.
Of those 35 launches, 13 were general-interest OTT TV services. The other 19 focused on a particular audience. This was not accidental. Sometimes we watch whatever is on TV, but more often than not, we seek out content we really like.
This is why the number of channels available in the U.S. exploded in the mid-1990s and early 2000s. Programmers began focusing on a core audience rather than trying to be everything to everyone. Since then, the cost of launching new cable channels has increased, and OTT TV has emerged as a cheap way to access niche audiences.
As the chart below shows, OTT TV providers, as compared to traditional cable providers, focus their products on niche genres with a higher degree of specialization.
For example, Cartoon Network is a traditional cable provider that offers a slate of various types of cartoons, including some anime. But if you are really into anime, you should look to the niche market, where there are already three OTT TV service providers focused solely on serving the anime market.
Future OTT success is driven by how targeted the service is (how well it serves the needs of a niche) and how avid the fans of the niche are.
For example, WWE’s platform has already been a huge success (one million subscriptions in its first year), with sharp niche focus and avid fans. As you can see in the figure below, UFC has an acute niche focus and devoted audience, so it is likely only a matter of time before UFC’s platform has similar success.
The red zone in the bottom right of the chart above represents a market that will be difficult for new OTT TV platforms to enter, given the wide availability and mass appeal of the existing offerings in this space. Of course, a deep-pocketed, media-rich asset could always try to make a move in the red zone, but the green zone in the top-left corner is where the opportunities really are.
Already in 2016, we’ve had some key OTT TV launches, including Seeso, Comic-Con HQ in conjunction with Lionsgate and the standalone Starz service. With a monthly fee of $4.99, Fullscreen’s subscription service focuses on the demographic that grew up with the social web (and this product looks very cool). And many others have announced upcoming OTT TV services (FilmStruck backed by Turner and several others).
In next week’s post, we will share our observations of dos and don’ts for launching OTT TV platforms.
Netflix in August: What's Coming and What to Watch Before It's Gone
Even though favorites like "The Pursuit of Happyness" and "The Best Man" are taking a leave of absence, there are plenty of new options to Netflix and chill with during the height of summer.
What's coming Aug. 1: Paul Newman's classic courtroom drama, "The Verdict," will be available Aug. 1
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What's coming Aug. 1: "Holding the Man," is adapted from a memoir of the same name about two teenagers falling in love at an all boys high school.
What's coming Aug. 1: "The Fast and the Furious" and "Tokyo Drift" offer a double dose of the late Paul Walker in the action-packed franchise.
What's coming Aug. 1: In light of the upcoming elections, catch up on an issue dear to Al Gore's (and that of many Americans') heart. "An Inconvenient Truth" is a documentary about the former vice president's campaign to raise awareness about global warming.
What's coming Aug. 1: The GOP presidential candidate released a book in the '80s that detailed his rise to success. Now, "Funny or Die Presents: Donald Trump's The Art of the Deal: The Movie," which is a parody of that infamous book.
Funny or Die
What's coming August 5: "David Cross: Making America Great Again" is a Netflix Original about the comedian's stand up tour.
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What's coming Aug. 9: "T-Rex" unfortunately isn't about a dinosaur, but it is a feel good documentary about the first U.S. woman to win an Olympic gold medal in boxing. It has the same premise as "Million Dollar Baby," but is actually true.
T-Rex
What's coming Aug. 10: "St. Vincent" is a comedy about a babysitting gig blossoming into a genuine friendship, starring Bill Murray, Melissa McCarthy, Naomi Watts.
St. Vincent Film
What's coming Aug. 11: "No Country for Old Men" has been on multiple "Best Films of the Decade" lists and now it'll be available for your streaming pleasure.
Miramax
What's coming August 12:
If this Netflix original series "The Get Down: Part 1" is anything like the streaming platform's other creations, it'll be worth watching. Plus, it's a musical drama television series. Kind of like "Glee," but not.
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What's coming Aug. 15: "Louis CK: Live at the Comedy Store" is exactly about what it's titled: Louis CK's standup night at the Comedy store in Los Angeles.
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What's leaving Aug. 1: Steve Martin and Eddie Murphy star in one of their better comedies, "Bowfinger." Watch it while you still can.
What's leaving Aug. 1: "The Best Man" is the beloved comedy drama prequel to the recently released "The Best Man Holiday." Simply a '90s classic.
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What's leaving Aug. 15: The crime fighting trio formally known as "Charlie's Angels" will no longer be kicking a--- on Netflix.
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What's leaving Aug. 16: "Inside Man" is another crime thriller about a fancy bank robbery in New York. Two reasons to watch before it's gone: Spike Lee and Denzel Washington.
Universal Movies
What's coming Aug. 25: Viggo Mortensen's "The Road" is a post apocalyptic drama based off a novel of the same name by Cormac McCarthy. It was also nominated for numerous BAFTA awards.
What's leaving Aug. 27: Bid a sad farewell to Will Smith's tear-jerking drama, "The Pursuit of Happyness."
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What's leaving Aug. 30: Freddy Krueger will no longer be getting his revenge on Netflix. "A Nightmare on Elm Street 2: Freddy's Revenge" won't be sticking around for Halloween.
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From hit movies like ”No Country for Old Men“ and ”The Best Man“ to original series such as ”David Cross: Making America Great Again“ and ”The Get Down: Part 1,“ check out your streaming options for next month
Even though favorites like "The Pursuit of Happyness" and "The Best Man" are taking a leave of absence, there are plenty of new options to Netflix and chill with during the height of summer.
Dan Schechter is a Managing Director and Partner at L.E.K. Consulting, and he leads the firm's Global Media, Entertainment & Technology practice. He has broad experience within the media, entertainment and technology sector, including TV, film, Internet content and commerce, radio, magazines, theme parks, advertising and news. He also has experience working with retail, consumer products, travel and industrial clients. Dan was awarded his MBA from Stanford University and his BA, cum laude, from Harvard University.