The streaming video aggregation wars will heat up in 2022

As traditional linear video slowly declines, the streaming world becomes increasingly fragmented and in need of platforms that recreate the simplicity of the bundle.

The video service aggregation and subscription channels store landscape is currently being roamed by giants like Amazon, Roku, Apple, Comcast and Google. But next year, emerging players like Redbox, Charter, MyBundle.TV, Plex, DirecTV Stream and Scener will each stake a claim and work to build user bases filled with consumers who want everything they watch in one place.

“Several cracks in the armor of the OTT video service experience become evident as consumers add more and more services to their viewing portfolio. Finding content is more difficult, often requiring subscribers to explore each service. Each service account must be managed separately, and each has its own payment system and credentials,” said Brett Sappington, vice president at Interpret, a consumer services research firm headquartered in Los Angeles.

Interpret’s research suggests users often don’t think about how many services they subscribe to, alternative options and other factors like free trials.

“Several companies are seeking to fill this void, including [consumer electronics] makers, communication/pay TV providers, online marketplaces (like Amazon Prime Video Channels or Apple Channels), cloud-based content discovery platforms, and many others,” said Sappington. “As we move into 2022, aggregators will take a more important role, particularly if the number of services per person finally ebbs. In this event, OTT services will be eager to work with any aggregator that can help them boost subscriber acquisitions and help maintain retention.”

TDG Research’s Michael Greeson has been prophesizing Pay TV 3.0 for years. In his original vision, Pay TV 3.0 operators needed to meet five criteria:

  1. A virtual storefront where one can shop, buy, and otherwise manage subscription video apps
  2. Single point of billing and customer service for all subscription video apps
  3. A unified content guide with comprehensive search and recommendations
  4. A seamless way to add or cancel apps (click and go)
  5. Inter-network app packages with discounts and contracts

Most aggregators provide one or more of these elements, Greeson said. For example, Amazon Channels to various degrees supports features one, two and four, while the Roku Channel to various degrees supports one, three and four. But there’s been a hold up around five.

“At the moment, DTC brands are fine playing in the first-generation sandbox—that is, pushing intra-network bundles. We believe that will change as the market for individual services saturate,” said Greeson, pointing toward Netflix, Hulu and Disney nearing full saturation in the U.S. while newer services like Paramount+ still have subscriber growth runway. “Once direct-to-consumer sales are maxed out, you’ll see DTC brands more eager to consider inter-network bundling, especially if, in exchange for discounting the service, they get a contract that locks users in for a specific period of time (say, six months or one-year contracts).”

According to TDG, Amazon, Apple and Roku—each with strategies the combine branded hardware and software—are all well positioned to become Pay TV 3.0 operators and fend off traditional pay TV operators like Comcast and Charter, which also both have eyes on the space with varying degrees of aggressiveness.

“It is worth mentioning that Comcast has a unique advantage other 3.0 prospects do not—that is, a long history of negotiating with studios/networks for carriage rights, and an existing pay TV user base that can be leveraged against them when negotiating streaming terms. Thus, Comcast may be in much better position than others to bend DTC providers toward an inter-network app bundle,” Greeson said.

TDG also sees LG and Samsung, which both own and operate their own smart TV platforms, as capable of competing with the largest app aggregators. Greeson pointed toward their smart TV apps stores including FASTs, AVODs, SVODs and TVODs along with their integrated guide for search/discovery and native TV remotes.

“In combination, they provide a surprisingly elegant experience for the CTV user, one arguably superior to ancillary systems,” he said.

Less well off in the video aggregation wars are the Pay TV 3.0 upstarts that may lack the scale.

“While smaller aggregators like Plex are including 3.0 components in their offerings, they do not have the muscle to negotiate inter-network bundles. I’m certain they’d be happy to resell them, but I don’t see them building their own,” he said.