The Shift in Streaming Strategy: OTTs Embrace Traditional TV Models
Online video streaming services, commonly known as OTTs, are rethinking their strategies by incorporating elements of traditional television. This shift is driven by a growing concern over declining user engagement rates, which directly impact subscriber retention. As users spend less time on these platforms, the risk of them canceling their subscriptions increases. To counter this trend, OTTs are reviving classic TV-style programming methods, such as live channels and sports broadcasts.
One of the most notable examples is Netflix, which is reportedly considering introducing 24-hour live channels dedicated to specific programs or genres. These channels would be featured prominently on the platform’s homepage, allowing users to “tune in” to content in a manner similar to traditional TV. This approach aims to create a more immersive and interactive experience for viewers, encouraging them to spend more time on the platform.
In addition to live channels, Netflix is also exploring bundled subscription packages. These packages could enable users to access other streaming services, such as NBCUniversal’s Peacock, directly through Netflix’s app. This move signals a broader strategy for Netflix to transition from being a simple content provider to a full-fledged platform operator.
Growth Challenges and Strategic Adjustments
Despite its dominance in the streaming industry, Netflix has encountered challenges in maintaining growth. Recent reports indicate that even its original content, which was once a major draw, has not met expected engagement levels. This has led to a slowdown in user growth and a significant drop in stock value, with shares losing nearly half their value over the past year.
During an annual management meeting earlier this year, Netflix identified user engagement as one of its key challenges. The company also released an earnings forecast that fell short of market expectations, further highlighting the need for strategic adjustments.
Live Content and Sports Broadcasting Gain Momentum
Domestic OTT platforms are also focusing on live content to retain users. Live broadcasts have become increasingly popular, drawing nearly as many viewers as on-demand content. In particular, news content has seen a surge in popularity, with many users turning to OTT platforms for real-time updates.
For example, during the December 2024 emergency martial law incident, Wavve experienced a dramatic increase in live news channel usage. The platform saw a threefold rise in engagement, and it has maintained double the pre-incident levels since then.
Sports broadcasting is another area where OTTs are investing heavily. Platforms like Coupang Play have secured rights to major leagues such as the English Premier League (EPL) and Major League Soccer (MLS), while TVING has attracted baseball fans with exclusive coverage of the KBO League. These broadcasts require extensive infrastructure, including live streaming capabilities, on-site production crews, and subtitle services, making them significantly more expensive to produce than general content.
Membership Offers and Exclusive Benefits
As OTTs continue to evolve, they are also offering new membership options to attract and retain users. For instance, some platforms provide tiered membership plans tailored to different audiences. One such offer includes a monthly membership at 5,900 won, with a discounted rate of 2,900 won for newspaper readers. Subscribers can enjoy access to 8 different newspapers and magazines worth up to 55,000 won, along with 7,000 points that can be used like cash for shopping.
These offers reflect the growing competition among OTTs to provide added value to their users. By combining exclusive content, live programming, and flexible subscription models, streaming platforms are working to stay relevant in an ever-changing media landscape.