The media industry continues to witness a shift from relying on physical shows to online streaming. As a result, numerous opportunities continue to arise as technology advances and the markets grow. To actualize a business development plan for a company in the industry, it is crucial to consider the opportunities and trends in the sector, as well as the sustainability strategies that the organization may implement. This paper will; discuss the entrepreneurial opportunities in the streaming industry, assess a particular opportunity, as well as evaluate the trends and their impact on the opportunities and sustainability of Netflix in the streaming sector. All this considered, Netflix’s use of AI and 5G is expected to promote the sustainability of the company by providing better quality as well as more dependable, user friendly, and convenient streaming services.
Entrepreneurial Opportunities
One of the opportunities in the streaming industry is the possibility of a complete shift to over-the-top (OTT) video content by both consumers and content creators (Koronios, 2019). Each year, numerous consumers are permanently switching from traditional cable TV to OTT. The move is attributed to the convenience of the services offered by the incoming alternative. Some of these conveniences include increased choices of shows, offline saving, no time restrictions, growing popularity of smart TVs and phones, as well as multiple platforms to log into the OTT applications. The shift is expected to continue for the next decade or so since leisure time is expected to decrease over the next five years (Koronios, 2019). Decreased leisure time means the consumer may prioritize video streaming as opposed to channel surfing for hours without finding desirable programs to watch. An increase in the use of smart TVs and phones across the globe will also create more opportunities in the streaming industry.
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The second opportunity lies within the possibility of the development of streaming services that are more dependable, user friendly, and convenient, coupled with better quality; all these will be achieved through technological innovations such as the 5G network and artificial intelligence (AI) (Mocke & Makala, 2019). The intersection of AI and 5G technology is expected to result in dramatic improvements in the efficiency and delivery of products and services in the streaming industry, among many other sectors. Actualization and deployment of the 5G network mean faster and more stable services provided by streaming companies. This revolution is expected to increase dependence on streaming and also lead to the development of more sophisticated streaming applications; therefore, the 5G technology will create numerous opportunities in the sector. AI’s use in the industry will complement the dependability of streaming services by personalizing the user experience, as well as improve the quality and convenience of streaming. The AI and 5G technologies coupled with the increasing dependence on smart devices will see the streaming industry discover new opportunities for the development of new applications and wider markets across the world.
Entrepreneurial Assessment
This paper will focus on the expected opportunities such as the development of new applications and wider markets arising from more dependable, user friendly, and convenient streaming services attributed to the 5G and AI technologies. Judging from the evidence presented by characteristics of the streaming industry, the opportunities listed above are viable.
Firstly, firms in the industry with the smallest market share are companies that have been unable to keep up with existing social trends. One of the factors that have affected firms' success within the industry is the level of investment in the production of quality original content (Stohr et al., 2020). Therefore, streaming companies that utilize the AI and 5G technologies to improve their production and delivery services are expected to record an increase in subscriptions. Content creation has seemingly become ubiquitous, with several networks producing their shows. Most consumers have found ways of streaming all forms of content without making any payments. This trend has increased the significance of original content as it acts as the primary way for video streaming firms to attract consumers. An example of such a firm is HBO with is show Game of Thrones, which has enabled it to thrive despite the high level of competition.
Secondly, the use of the technology by content creators will ensure diverse shows for the clients which may reach more audiences. Over the years, the market for digital streaming services has considerably increased. This market is characterized by a high level of diversity in regards to the age, gender, income level, and ethnic background of consumers. With the growth in the market, firms are increasingly expected to cater to this diversity through the provision of content that caters to their different interests. Firms that have been successful in the industry are organizations that have targeted different demographics of people, gaining popularity across a wide range of the market. AI can also be used to analyze consumer data to predict which shows may be popular in specific areas.
Trends
The current economic downturn caused by the COVID-19 pandemic does not deserve an introduction. Despite its severity, particularly in economic terms, it is evident that the pandemic has positively impacted the streaming industry (Trefis Team, 2020). As more people were forced to stay home due to travel restrictions, companies in the industry reported rises in subscribers, with proportional implications for their revenues. However, fluctuations of the dollar against many of the currencies in countries where streaming companies have established their reach mean that the companies could lose sales value through currency instability. The overall implication of the changing currency value is forced adjustments on the balance sheet and potentially needlessly higher pricing tariffs to cater for possible currency variations.
Many leading streaming services such as Netflix, Hulu, and HBO have an obvious market penetration advantage over its competitors. However, the company's real technological victory lies in its ability to transform large videos (based on the file size) to better accessible files for easier streaming while preserving the desired quality of the content. The expectations for high-quality content guide these giant streaming services productions. As a result, the companies have retained their leading role in the global video streaming sphere and will continue to play the same role if no adverse occurrences disrupt its model.
Impact on Opportunities
The first noted trend is the increase in viewership and subscriptions as a result of more people working from home. This trend will positively impact the opportunities for the complete switch from cable TV to OTT as well as the possibilities of the development of new applications and wider markets across the world. This is because as more people stay at home, the subscription rate of streaming services is expected to increase.
The second trend is the use of technology by leading companies in the sector to transform large videos to better accessible files for easier streaming while preserving the desired quality of the content. This trend will significantly influence the development of the selected intrapreneurial and entrepreneurial opportunities. The intersection of AI and 5G technology is expected to result in significant improvements in the efficiency and delivery of products and services in the streaming industry. Therefore, most of the leading companies will heavily invest in AI and 5G to ensure the development of streaming services that are more dependable, user friendly, and convenient.
Impact on Sustainability
To remain sustainable with the emerging opportunities and the ongoing trends in the industry, Netflix should invest early in the 5G and AI technologies. Failure to do so will see the company lose a significant part of the market share as numerous consumers are expected to advance with the evolving technology. Utilizing the two revolutionary innovations will also add to the company’s quality of production, data analysis, delivery, and dependability of the organization’s streaming services. These advantages will ensure the company remains sustainable in the competitive industry.
Conclusion
All this considered, Netflix’s use of AI and 5G is expected to promote the sustainability of the company by providing, better quality as well as more dependable, user-friendly, and convenient streaming services. A complete shift from cable TV to OTT is the other opportunity that is expected to arise in the future. The existing trends in the industry are increased subscription to streaming services and technological/quality competition among the leading companies in the industry. These trends are expected to fasten the actualization of the opportunities identified in the industry .
References
Koronios, E. (2019). Opportunities and Challenges: Video Streaming Services . IBIS World. https://www.ibisworld.com/industry-insider/analyst-insights/opportunities-and-challenges-video-streaming-services-in-canada/
Mocke, P., & Makala, B. (2019). Artificial Intelligence and 5G Mobile Technology Can Drive Investment Opportunities in Emerging Markets . https://openknowledge.worldbank.org/handle/10986/33388
Stöhr et al. (2019). Happily Ever After? – Vertical and Horizontal Mergers in the U.S. Media Industry. SSRN Electronic Journal , 3 (11), 28-40. https://doi.org/10.2139/ssrn.3398913
Trefis Team. (2020). The Significance Of Netflix's Technology & Development Expenses . Forbes. Retrieved from https://www.forbes.com/sites/greatspeculations/2016/08/17/the-significance-of-netflixs-technology-development-expenses/?sh=23b9ff733393
