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Issue link: https://digital.macdirectory.com/i/1359241
US penetration is down about 78 percent while the Asia-Pacific market is expected to grow to more than 666M in two years. Similarly, the Latin American and MEA markets will increase. In case you missed it, one of the biggest challenges for Pay TV is the lack of high-quality scripted content. Unscripted shows, which we aggressively avoid, increased 24 percent this past year and have found a growing audience of people barricaded in their homes. When we see the fake reality TV shows promoted, the only thing we can think of is being seated in a coliseum in ancient Rome rooting for the lion. As the cancelled upfront gala showed early this spring, there were few fall/midseason series unveiled because of the long and aborted production periods. And the drought will continue into 2021. While networks are rushing to get new projects completed (comedy, crime/thriller, romance, drama, sci-fi and fantasy) they’re relying on their libraries of past shows to fill the entertainment gap. But the content distribution market has grown broader and deeper. Everything was still going well for theaters and Pay TV until Reid Hastings and the old red envelope company decided it was time for a change. O.K., it wasn’t just Netflix at that time (In fact, it was a small streaming on-demand service in early 2000 called SelectPlay that kicked things off.), but it didn’t take long for everyone to figure out that going D2C was not only fun (bypassing the cable guy) but maybe profitable. “Overnight” this past year more than 1K OTT services emerged to give consumers different, unique content they could enjoy on their own terms. The current global SVOD leaders are Netflix, Amazon, Disney+, Apple TV+ and YouTube. Often referred to as the Big 5, they are far from alone in their quest to capture subscriber screens. Despite a stumble out of the gate, AT&T/Warner/HBO Max is focused on capturing market share while balancing the needs of their parent’s $85B debt along with those same parents’ desire to keep theater chains happy/supplied (tentpole Tenet ultimately brought in about $350M in ticket sales). Disney+ and Hulu have shown the fastest growth (14 and 17 percent respectively) nationally and internationally. Disney’s willingness to add PVOD offerings like Hamilton and Mulan to stimulate awareness and interest in subscribing to their service has worked, growing global subscriptions to more than 86M in a mere nine months since the launch with its eye on being a $40B streaming giant within five years. Hulu (owned by Disney), CBS All Access, BBC, ESPN+ (Disney), Sky’s Now TV, iflix and a myriad of other subscription services are also vying for subscribers. While the US still represents the largest entertainment market (43 percent), the protected borders of China is the world’s second largest – and eyeing top slot - entertainment market (1.4B population). The country’s fast-growing, deep-pocketed BAT – Baidu (iQiyi), Alibaba (Youku) and Tencent – are also focusing on the international arena. Allan McLennan, Chief Executive of PADEM Media Group, noted that the Big 10 streamers still have more international experience and production quality than the BAT firms. “The Big ten are focused on improving their quality and quantity,” he said. “They are co-producing variety shows, drama, animation and other projects for their local and global markets. “It’s not a matter of if they will be able to compete as equals in the entertainment world, but how soon,” he emphasized. iQiyi has more than 100M paying subscribers, Tencent over 95M and Youku more than 85M subscribers. In addition, all three have 100s of millions of ad-supported viewers. India, also with a population of about 1.4B, has a number of leading AVOD and SVOD