2020 wasn’t meant to be like this. When we all welcomed in this year on New Year’s Eve, it was with the usual hope and expectation that 2020 would be an improvement on the previous year. 

The Coronavirus put paid to that.

Globally, over 800,000 have died. Over 23 million have been infected. That tends to put things into perspective. Economies have been wrecked, job losses have happened all over the world and most likely will continue to happen. It will take countries and companies years to recover from the impact of COVID-19.

There is no plus side to this, not when you look at what has happened. The TV space though has been relatively unaffected. I say relatively, as with many sports closed down, many operators had to suspend the subscriptions that end users pay for their sports content. You can’t pay a monthly sub if the content isn’t there. Now, with sports opening up again, the vast majority are all being played behind closed doors. In theory that means if you want to watch an event, the only place you can watch it is through your TV subscription.

There is also an element of those that pay mega money for the broadcast rights to sport, starting to evaluate how much they have paid and the return they get for this. It seems likely that the billion $€£ deals paid out for sports broadcast rights have reached their peak and the next time these come up for renewal, a sense of reality might prevail, even taking into account some of the new entrants into this area, such as Amazon Prime.

Leaving aside sport, with people being told to spend time at home, it’s been a boom time for streaming services and the ability for people to binge watch and catch up. A recent report by Grabyo showed that in UK spending on online streaming services increased by over £100 million, or a 25% increase since lockdown started in March. It also said that 82% of UK consumers currently pay for video services, with 30% of these subscribing to a new streaming service since March 2020.

As lockdown eases and people start reverting to what could be called the new normal, will this continue? Well, the same Grabyo report states that 80% of streaming customers said they planned to continue with the same number of streaming subscriptions. 

A recent Brightcove report seemed to confirm this, as it stated that streaming has become the go-to choice for viewing and that every type of device saw a surge in use

So, all is well in the TV space then. Well, not quite, as PayTV subscriptions in UK have dropped 9% during the same period. 

In US a Leichtman Group study showed the largest PayTV operators lost about 1.57 million net subscribers in Q2. The top telephony IPTV providers, who have around 8 million subs, lost 160,000 video subs in this period. Although this market has been decreasing for some time due to cord cutting, Leichtman says that vMVPD services has also declined, with the likes of Hulu+, Sling & AT&T TVNow losing about 25,000 subs in Q2, compared to a gain of around 80,000 in Q2 2019.

Conversely,  FuboTV, the US sports focused OTT service, reported Q2 revenues of $44.2 million, which was a 53% increase year on year, with an increase in ARPU to go along with it. This happened when there was virtually no live sport being played.

Conflicting data and information. We have to bear in mind though, that when people are faced with losing their jobs, their livelihoods and incomes, then they will cut back and TV subscriptions of all types are one area that can and will be cut back. For those of us lucky enough to not be in that position, we can choose what we want to watch, where and how we want to watch it.

Looking at the technology used, many operators have delayed their plans to change what they currently have, focusing more on being able to meet the increased demand being driven by users watching more TV. That then has a knock on effect on vendors. Teleste recently stated that sales dropped significantly in Q2, as operators stopped working on network upgrades and projects due to COVID-19 restrictions. They won’t be the only ones and this trend is likely to continue for the remainder of 2020.

What is likely to happen though is that operators have just delayed these upgrades and projects and also take a view that sees them identifying the weak points in their solution they have identified, due to the increased demand caused by the amount of people staying at home and watching TV. That then translates into the operator reviewing what they have now and needing to upgrade or renew, as we move into 2021.

While 2020 has so far been nothing short of a disaster for the world, possibly in the content TV space a realignment can take place, one where the enormous sums of money paid for sports rights can be reconsidered and where monthly subscriptions can reflect this and maybe some sports can consider going back to being FTA. A pipe dream? Possibly, but there is now a chance to look again at this area. 

For those involved in providing solutions to operators, there is a chink of light that means we just sit tight and plan and prepare for what is going to be needed when operators are ready once again to strengthen their solutions.