Exponential advances in technology have changed entire industries, especially over the past 10 to 15 years. For example, Netflix, Amazon Prime, HBO, Hulu, and digital channels are massive disruptive forces within the media and television industries. Further, given the rapid pace of technological change, the landscape will continue to evolve and look completely different a decade from now. Here are three bold predictions.
1. Freedom to Choose
The cable TV industry has traditionally featured a lineup of popular channels that customers purchase as packages. A customer who wants ESPN, for example, must purchase a bundle that includes multiple channels, one of which is ESPN. This bundling of channels gives consumers the option to buy a combined package, which theoretically costs less than buying each channel separately.
- The television industry has seen exponential changes over the past ten years and the disruption is likely to continue over the next ten years.
- Cable TV companies might have no choice but to unbundle packages as they face growing competition from Netflix, Hulu, and Amazon Prime.
- Traditional advertising models become antiquated when media companies shift to subscription-based models.
- Smart TVs and virtual reality are changing the way consumers interact with content.
Cable TV is facing growing competition, however. With companies such as YouTube, HBO, Hulu, Netflix, Apple TV, and Amazon Prime producing and offering premium shows, the interest in traditional cable television has declined. What's more, in the future, analysts expect that these premium services are likely to have recommendation engines so powerful that they preclude the need to browse shows, offering libraries made up of millions of options and catered to the viewing habits of each subscriber.
This change in the way people consume content has put pressure on traditional television providers to reconsider the way they offer channels. Customers are calling for "unbundling," and the opportunity to choose and pay for only the channels that they want.
Many streaming services, like Sling TV, YouTube TV, PlayStation Vue, and FuboTV, already offer this sort of service. In the future, traditional cable channels are likely to be unbundled, as online service providers such as Netflix continue to rise in popularity, resulting in a landscape where people mix and match TV channels and premium subscriptions.
2. Commercials Become Antiquated
Streaming-service providers are proving that it's possible to create and grow successful enterprises around a business model that includes little or no revenue from commercials. The trend is now changing to one based on a subscription model rather than on ad revenue alone. In ten years, even traditional cable providers are likely to become subscription services, allowing unbundling and a tiered fee structure based on the type and number of channels a consumer chooses.
Further, a hybrid model may be available ten years from now in which a subscription service is combined with smart advertising. In this scenario, rather than having three-minute commercial spots during a 30-minute television program, TV programming may change to one where a consumer must have a monthly subscription and then view targeted banner ads. This type of advertising already occurs on the Internet, and the amount of data television companies collect allows them to do much the same.
3. More Interactivity
Companies such as Facebook, Google, and Microsoft have all developed virtual reality technologies. Within the next ten years, traditional television screens are likely to make way, at least in part, for variations that pair with VR eye-wear and headsets. Evidence of this is already available in Google's development and subsequent abandoning of Google Glass as well as Samsung's foray into wearable accessories that help turn phones into virtual reality machines.
What's more, all televisions are likely to become smart TVs within the next ten years. Expect these devices—which allow users to stream videos and music, browse the Internet, and view photos—to be ubiquitous in homes across the world, adding to the power and potential of virtual reality and future programming.
There is a race among technology giants to be the leader in smart TV development, including companies both inside and outside the industry. Businesses such as Google, Apple, Netflix, and Amazon are all developing more powerful smart TVs, and the trend is likely to make the technology much more affordable for consumers.