The Future of Streaming Platforms: Key Trends and Outlook

When Netflix first introduced its pivot from mail-order DVD rentals to streaming services in 2007, no one could have predicted the level of disruption and transformation this shift would bring. Less than two decades later, streaming services have taken over as one of the leading forms of digital entertainment, significantly disrupting cable and broadcast television, and completely transforming consumer behavior and expectations.

On average, Americans dedicate around 21 hours per week to streaming digital media, and a whopping 99% of American households subscribe to at least one streaming service. Consumers have come to expect on-demand entertainment—being able to watch whatever show or movie they want, whenever they want it. This is a far cry from the days of cable television, where viewers were limited to scheduled programming and TV ads were an unavoidable, albeit annoying, part of the viewing experience. 

Today, the digital media space is dominated by household name giants Netflix, Amazon Prime Video, Disney Plus, Max, and Apple TV+, among several others. Each streaming platform offers its own library of movies and TV shows and has a differentiated approach to attracting subscribers. 

Americans pay for an average of 2.9 subscriptions every month—a reflection of consumers’ preferences for variety and loyalty to different platforms—but as the streaming landscape becomes increasingly saturated, the balance between profitability, competitiveness, and customer retention becomes increasingly difficult to strike.

Below, we use the AlphaSense platform to:

• Identify the top players in the streaming landscape today
• Uncover key trends shaping the streaming landscape, including the growing competition between streaming services
• Explore the major challenges streaming providers are facing to attract and retain customers
• Discuss the future outlook for the streaming industry

Top Players in Streaming Services: Strengths and Weaknesses

Netflix

In addition to being the first mover in the streaming space, Netflix remains the most subscribed to video streaming platform, with over 260 million subscribers worldwide. While Netflix began as an aggregator of movies and TV shows, it’s since become a well-respected producer of original content, which helps it attract new customers.

Netflix differs from its competitors in several key ways. First, it’s a tech company, which means it’s more adaptable to new technologies and also has the resources to continually improve its tech based on subscribers’ preferences. For instance, Netflix is known for its highly accurate algorithm that provides customized recommendations for viewers based on their interests and preferences. Second, unlike the majority of its competitors, streaming is Netflix’s primary source of revenue, representing 99% of total revenue.

Last year, in a highly controversial move, Netflix decided to crack down on password sharing when it recognized it was losing out on both subscribers and revenue by allowing multiple people to use a single account. While the decision initially led to a stock dip, as well as an outcry from consumers, it ultimately resulted in a surge of subscribers and a revenue jump.

Priced on the higher end of the spectrum, Netflix’s membership cost is $15.49 per month, with a lower-priced ad tier at $6.99 a month.

For more on Netflix—including company documents, news, broker research, and expert transcripts—check out the NFLX page in AlphaSense.

Amazon Prime Video

Introduced in 2011 by e-commerce giant Amazon, this streaming service boasts over 200 million subscribers. However, it’s important to note that this service is built into Amazon Prime subscribers’ packages, so the aforementioned figure includes subscribers who do not utilize the Video offering at all.

Like Netflix, Amazon both aggregates existing content and produces award-winning original content for its platform. Additionally, for movies and shows not available in Amazon’s free on-demand library, the option to rent or buy for an added fee and watch immediately is available. 

As Amazon Prime Video is part of the Amazon Prime membership charge, the cost per month is $14.99.

For more on Amazon—including company documents, news, broker research, and expert transcripts—check out the AMZN page in AlphaSense.

Disney Plus

One of the newer streaming platforms, Disney Plus was established in 2019 and has already amassed over 150 million subscribers. The main reason for its success is the immense popularity and demand of its content universe. Upon establishing the platform, Disney pulled all of its licensed content from other streaming platforms and turned Disney Plus into an immense repository of Disney-owned content. This also includes all Marvel, Pixar, National Geographic, and Star Wars content.

Disney Plus is priced at $13.99 per month.

For more on Disney—including company documents, news, broker research, and expert transcripts—check out the DIS page in AlphaSense.

Max

Established in 2011 and originally called HBO Go, this was previously a service for HBO channel subscribers to stream HBO programming online. In 2015, HBO launched an on-demand streaming platform called HBO Now, available even to those without a subscription to the HBO television channel.

Then in 2020, HBO Max replaced both HBO Go and HBO Now and began expanding globally and introducing new, mostly original content. Finally, in 2022, WarnerMedia merged with Discovery, Inc. and rebranded HBO Max to simply Max, adding content from Discovery, as well as additional Warner Brothers features. Max has been highly successful, mostly due to its high-quality, award-winning, and often viral original content. 

Max has just under 100 million subscribers and three pricing tiers: ultimate ad-free for $20.99, ad-free for $16.99, and an ad tier for $9.99.

For more on Warner Bros. Discovery, Inc.—including company documents, news, broker research, and expert transcripts—check out the WBD page in AlphaSense.

Apple TV+

A relatively new entrant, Apple TV+ was established in 2019 and is owned and operated by Apple Inc. Compared to its competitors, Apple TV+ has a much smaller content library and is also priced much more affordably at $9.99 per month. The subscriber count for Apple TV+ is around 25 million. 

Every piece of content on Apple TV+ is exclusive to the platform, and much of it has received awards and gone viral.

For more on Apple—including company documents, news, broker research, and expert transcripts—check out the AAPL page in AlphaSense.

Key Trends in Streaming

Streaming Bundles

Streaming service bundles are becoming more common and will likely keep growing in popularity. Why? Firstly, they provide more flexibility and variety to the consumer while also being much more cost-effective. Secondly, bundling is effective at reducing churn, as it minimizes the common practice of canceling a subscription for a service upon finishing a particular show. Finally, bundling helps streaming services offset the rising cost of content, as they can effectively offer more content to subscribers without needing to purchase it themselves. 

Disney has offered a Disney Plus, Hulu, ESPN bundle for years. Another more recent bundle is Comcast’s Netflix, Apple TV+, and Peacock. Coming soon, Disney Plus, Hulu, and Max will be included in a bundle, according to Disney Press. While Netflix is currently still the undisputed leader in the streaming service space, bundling dramatically increases the competitiveness of services such as Disney Plus and Hulu and helps them gain market share much faster.

“I think that there is actually validity to the fact that Disney and Hulu could catch up to Netflix in some way, especially because if they’re just able to convert a lot of their individual subscribers to bundling subscribers, then that’s going to help. It’s really going to be, I think, Netflix versus Disney in terms of just continuing to see who can push each other higher and higher from a streaming subscriber’s perspective.”

– Former Senior Manager, The Walt Disney Company | Expert Transcript

Profitability Over Subscribers

Throughout the history of streaming services, subscriber count was seen as the ultimate indicator of success or failure. 

“…The subscriber numbers were the way that you were proving to either your financial backers or to Wall Street that you were growing, and so it was a little bit of a growth-at-all-cost mentality. Something like Netflix was spending billions of dollars and gaining millions of subscribers, and so they set the template, and then when you would launch your product, your goal was to show how many millions of subscribers you had and how you could grow that. That has since changed.”

– Former VP, Warner Bros. Discovery Inc. | Expert Transcript

In early 2022, Netflix announced that it had lost subscribers for the first time in a decade. This was a turning point for the industry. Streaming companies had been operating under the assumption that they only needed to focus on attracting new subscribers, and eventually, they could raise prices to counteract any losses. And yet, Netflix’s announcement showed there was a clear ceiling to what consumers were willing to pay for streaming before they canceled their subscriptions. Consequently, streaming services had to look to alternative methods of boosting profitability.

“Remember, we were talking about the metric changing in the spring of 2022, so the idea that ‘The more you spend, the more people you acquire. It’s worth that spend,’ has changed. It now needs to be, ‘The money you spend and the customers you bring in have to still create a balance of profitability,’ so everyone is spending less.”

– Former VP, Warner Bros. Discovery Inc. | Expert Transcript

Ad Tiers and Pay-Per-View

History seems to be repeating itself, as more and more streaming services are moving toward elements of cable and broadcast television to maintain profitability. At this point, nearly every top streaming service has introduced a lower-priced ad tier in its subscription options, allowing it to earn more money from ads and capture more price-sensitive customers.

The new motion is paying off—Netflix is set to generate roughly $1 billion in ad revenue this year, according to eMarketer estimates, and Disney has generated $1.7 billion this fiscal year.

Additionally, some experts believe streaming services will move toward a pay-per-view model, where they charge an additional fee for premium content. 

“Yeah. Think about how easy for Disney or for Netflix or Max or whoever to do a pay-per-view. They already have your billing information, your card info, and they have the platform to promote and push the content. The only hurdle is to educate people or convince people that “Hey, you can pay for stuff on the platform.” Normally, you pay a subscription, you assume that everything is free on Disney or Max or whatever, but Amazon does that.

Amazon, you have what is free, thanks to the Prime Video subscription, but you also can rent and buy a new movie that was just released. I think it’s more like getting people used to it, but I’m pretty sure that this will come at some point because again, it’s another way to make money. It’s one of the model that traditional TV used. It’s just a cycle. They’re going to use the same kind of techniques and strategy than the old-school linear TV.”

– Former VP, Warner Bros. Discovery Inc. | Expert Transcript

In a surprising twist, streaming platforms are finding that in order to stay afloat in the industry, they need to emulate the very industry they disrupted in the first place. Ad-supported tiers are significantly more lucrative, as they allow the streaming service to make money off new subscribers, as well as ad revenue. Additionally, pay-per-view content allows the streaming service to maximize the revenue it makes from its existing subscribers.

AI, Customization, and Personalization

Artificial intelligence (AI) has disrupted every industry over the past decade, and streaming is no exception. Highly successful streaming companies know that in order to retain subscribers for the long haul, they must do more than simply deliver content—they must create an experience that feels unique and personalized to each consumer. This means investing in AI algorithms that collect data about each viewer’s behaviors and then provide customized recommendations that match the user’s preferences.

Streaming platforms that create original content have also been using AI and data analytics to assess what is most popular with their user base so that they can incorporate those preferences into their future productions. Similarly, by analyzing viewer data and trends, streaming services can better predict what external content will perform best with viewers, which then informs the content they choose to invest in. 

Just as consumers are seeking out more personalization and customization in their retail shopping, dining, and consumer goods preferences, so too are they looking for that in their entertainment. Netflix has a leg up in this domain, as it has always been a tech company first and a content company second. Therefore, it has the advantage of years of investment in data and AI, enabling it to deliver better, more tailored experiences to customers. 

Legacy content companies that have more recently entered the streaming space, such as Disney Plus, Paramount Plus, or Max, are going to have a harder time in this arena. Embracing digital transformation and new AI solutions will be critical for them to remain competitive.

Sports Appeal

Another major trend driving the streaming industry is sports programming. Streaming platforms have recognized that a substantial pool of subscribers is interested in streaming live sporting events. Adding sports streaming could help platforms reduce churn—rather than constantly needing to add high-quality content to keep subscribers, streaming providers can simply allow sporting events to do the heavy lifting. Finally, adding sports streaming attracts advertisers’ business which would also boost revenue.

Amazon now offers sports streaming of NFL, NHL, and WNBA in the US, as well as Champions League games in Europe. Apple TV+ features Major League Baseball and Major League Soccer. Most recently, Netflix has joined Apple, Amazon, Disney, and other streamers in the bidding battle for live sports, announcing that they will be showing two NFL games on Christmas 2024.

Similarly to the return to ads and pay-per-view, this new trend seems to call back to the days of cable and broadcast television. It’s likely that streaming platforms will continue putting increasing focus on live events in order to keep subscribers engaged and reduce churn.

“From what I understand and read and know about the live sports CPMs are upwards to four times what they are for other general programming. There’s only so many shows that are going to be able to draw this large audience. There’s just so much content of varying qualities available to license…”

“The live sports component really plays in well to attract advertisers and also anchor users into a platform. There’s no one more dedicated to a piece of content than sports fans are. It’s definitely becoming an anchor for a lot of different platforms because users are going to want to stay subscribed and engaged and they will watch when the programming does come on. That focus isn’t necessarily depressing the viability or the licensing opportunities for scripted or non-sports content. It’s definitely made it seem maybe less valuable to the different platforms.”

– Former Director, Paramount Global | Expert Transcript

Future Outlook on Streaming Platforms

What does the future of streaming platforms look like? Most industry experts believe it looks smaller. The current market is far too saturated, and consumers are reaching a breaking point with how many platforms they are willing to subscribe to. According to a Deloitte survey, 36% of Americans believe streaming platforms overall are not worth the price.

Netflix and Amazon will almost certainly remain, as will some combination of Disney and Hulu. Apple TV+ may remain as a niche participant in the market but is unlikely to pose a real competitive threat to the other players. The future of Max, as well as Paramount Plus, Peacock, and others, is much more uncertain. 

When asked where he sees the streaming industry in 15 years, one expert predicts that big tech will dominate, while legacy content companies like Paramount and Warner Bros. Discovery will likely go through mergers or be acquired by their tech competitors:

“Fifteen years is a really long time, especially in this business, but I would say probably big tech. I think tech is making money hand over fist, and they’re taking a lot of the eyeballs away from streaming and television. If Google tries to get in the game, I guess Amazon is in it, but if Meta decides to buy a studio, I think it’s just whoever has enough money to keep acquiring.

I think there’s going to be a lot more mergers. I think Warner Bros. Discovery is probably on the chopping block. It’s very clear that Paramount is, although it’s not quite finding a buyer. I think those are going to be consolidated into the bigger players but again, things like an Apple or an Amazon, they can continue to pour money into it because it’s not their chief revenue source. It’s not the thing that’s keeping them afloat.”

– Former VP, Warner Bros. Discovery Inc. | Expert Transcript

As the cost of producing and acquiring content gets increasingly higher, platforms will need to find ways to mitigate and share that cost. Delivering stellar customer experiences—such as through the use of AI and technology—will be instrumental in retaining customers, but eventually each streaming platform is expected to hit a ceiling of subscriber growth.

“They have to look for other growth opportunities, and the growth opportunity is to also being able to tap into other platform agents and steal from them or ultimately merge their users with their own users.”

“For the case of Warner, they can’t sustain by themselves the costs of production and media rights and whatnot. That’s why, I think, the future for them, Paramount or Warner, is to partner with either a tech company or another studio to be able to reduce the risk, to expand their reach, and to have also more content ultimately to offer to their subscribers.”

– Former VP, Warner Bros. Discovery Inc. | Expert Transcript

In addition to downsizing, the future of streaming platforms will likely look even more like the cable days of yore, albeit much more personalized and on-demand. We will likely see an increasing number of ads, more pay-per-view programming, and live events available to stream on major streaming platforms.

Overall, the streaming industry is fast evolving, and there is tremendous potential for improvement. For example, as one expert suggests, integrating social media and user-generated content into streaming platforms remains an area of opportunity that no one is taking advantage of. Adding even more personalized features and creating more differentiation between unique customers’ viewing experiences is something social media platforms have mastered, but streaming platforms could stand to improve on. 

Stay on Top of the Streaming Platform Landscape with AlphaSense

The streaming industry is evolving rapidly, and it’s critical to stay on top of every new development, trend, and key player that could affect the market. To do that, you need a tool that surfaces all the right insights and cuts through the noise so you can focus on leveraging and analyzing information rather than searching for it. 

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