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Home Entertainment 2025: The Push for Profits

While Netflix sidesteps subscriber growth, the competition remains fixated on scale and sub gains as a means of increasing ad revenue (i.e. marketers), which they now see as a key component in their quest for profitability. And with good reason: Parks Associates reports that 57% of subscribers to major streaming platforms now choose ad-supported tiers.

One problem facing the FAST business is legacy television. At an OTT.X breakfast conference, Parks Associates president Elizabeth Parks pointed out that despite the erosion of the pay-TV business, 42% of households still have traditional pay-TV service, “and just as a point of reference, that’s about 48 million households that are still watching traditional TV — and then you have practically everybody watching streaming as well.”

“This creates a problem for advertisers,” Parks said. “The brands — they don’t know where to go to get the eyeballs, and they still are going to be centered on these millions and millions of households in one place versus hundreds of direct-streaming services. And that’s why I think, in 2025, we’re going to see a lot of consolidation and a lot of services coming together.”

From the article, "Home Entertainment 2025: The Push for Profits" by Erik Gruenwedel

Previously In The News

The Simple Reason Why I Won't Buy Roku Inc.

Roku (NASDAQ:ROKU) went public on Sep. 28, its stock surging nearly 70% from its IPO price of $14 per share. The stock hit almost $30 the following day, but subsequently pulled back to the low $20s....

Google's Next Chromecast Could Look More Like a Roku Box

Things have changed. Parks Associates analysis in 2014 found that Chromecast had replaced Apple TV in second place behind Roku. Its market share was 20%. In 2019, though, Parks Associates found that o...

AT&T Deal: Merger For New Media Era Or A Bad Remake?

Pay-TV operators are seeing a "slow erosion of the core business," analyst Brett Sappington at Parks Associates said. "After years of attempts to be more than just a 'dumb pipe,' pay-TV operators h...

Netflix's Hidden Price Hike

Do consumers make the jump? Studies suggest that they do. The most recent Parks Associates study of Netflix's tiers, released in summer of 2018, showed a significant increase in the number of premium...

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