Entertainment at your fingertip
In the entertainment sector, vast, and evident changes have occurred in the last few years in response to recent, uncertain times. We have witnessed a significant migration of content and entertainment personalities to online platforms, and further evolvements in streaming platforms, with the introduction of Disney+ and the further development of platforms such as Netflix, which has consistently seen a 6.7% revenue increase year-on-year, even throughout Covid, generating $31.6 billion in 2022. Uncertainties, such as Covid-19 restrictions, have crudely encouraged these progressions in entertainment, which have been happily accepted by the vast majority, and despite the return of “normality”, it is clear that these changes are here to stay.
With the consistent population growth, it is clear that global pandemics are inevitable and that trends in digital media usage will positively incline. In January 2023, 64.4% of the world’s population accessed digital media, with a yearly growth rate of 2%, highlighting the favourability of digital entertainment, as opposed to in-person entertainment, such as theatre, with 61% of British theatres operating at a loss due to Covid. These changes offer significant opportunities for the digital entertainment industry, streaming services can address audiences whose needs are no longer fulfilled elsewhere, whether that is content-based or location-based.
Technology presents an opportunity for digital entertainment to cater to consumer needs, far greater than in-person entertainment. The constant recording of data provides businesses with the opportunity to greater understand consumer needs and behaviour patterns, significantly; what content and when content is engaged with, and for how long. This means that businesses that specialise in digital content have a greater chance of catering to the needs of such vast audiences. The segmentation of data allows businesses to market shows and other content to the people that are most likely to engage with it.
Similarly, technology further ensures consumer satisfaction through the constant progression of audio and visuals, for example, the development of virtual reality technology and the increased accessibility of surround sound audio systems brings both the content and experience to life. This consistent evolution of technology further benefits the entertainment sector as it equally improves the speed and quality of content creation. Post-production, sound engineering, and video editing are equally responsible for consumer experience, and as the technological tools continue to improve, we will begin to see the greater quality in both visuals and sound, and the magical quality of the content we consume will prevail.
The entertainment sector further benefits from technology through the increased accessibility of resources. At the touch of a button, entertainment businesses have access to thousands of actors, editors, sound engineers and so on. Advancements in technology have reshaped the hiring process altogether, a business can now easily “shop” for the right actor for the right role, this simplification of monotonous tasks further allows businesses to use their resources more effectively too, as they can quickly highlight the best candidates for the job. Furthermore, this ensures quicker production time as money can be spent beneficially.
Similarly, the entertainment sector benefits from the accessibility that technology provides to the consumer. At the start of 2023, it was recorded that an estimated 6.8 billion people used a smartphone, worldwide. This means that 6.8 billion have movies, TV shows, and short videos (such as TikTok and Instagram reels) at their fingertips. The ease of accessibility and functionality ensures the maintenance of consumer engagement as there is no specific time or place for a smartphone user to access given content, the opportunities are limitless. This is beneficial for the entertainment sector as they are less dependent upon consumer behaviours, as content is being consumers on a greater frequency and quantity, the creators themselves hold more power.
Despite the benefits that technology provides, there are in fact many downsides. The convenience of piracy is known to attract many, and with the increase in pay-per-view content, it is somewhat unsurprising that online piracy is, again, on the rise. In early 2023, it was estimated that pirated material gets viewed over 230 billion times a year, with illegal streaming services being responsible for 80% of this. This impacts the entertainment sector through revenue loss, significantly resulting in a decrease in the quality and frequency of content because it is harder to produce and advertise, and even hire people to star in content, creating an unsustainable work environment.
Another notable downside of technology is the competition that comes with the increased accessibility for consumers. For streaming services, such as Netflix, there are now a vast array of alternatives for a consumer to choose from, whether that is Disney+, Prime, or YouTube TV. Similarly, the variety of content for an audience to consume is growing, making it harder for companies within the entertainment sector to maintain a loyal consumer base, meaning it is harder to increase brand equity and affinity, and hold control within this market.
Despite the worldwide majority being technologically aware, there are many, such as older populations, who are unable to access online media. With a jump being made, within the entertainment industry, to online content, it is clear to see that a demographic is being left in the past, yet unfortunately for this sector, it is evident that in-person-entertainment is unlikely to be revived, and these consumers will be lost. This is one significant change as it results in the overall loss of future sales and revenue.
Similarly, many consumers are being alienated through the increase in pay-per-view content. These consumers may not be able to afford to subscribe to access certain material, for instance, the UFC. Because of this, the entertainment industry has further limited its consumer base. And despite this meaning that desired customers can be targeted, it results in a loss of potential consumers, causing further detrimental, long-term effects. Furthermore, it does not attract a committed and sustainable consumer base, and it heavily limits brand awareness.
