Next year, it may not only be cord-cutters getting rid of their cable and satellite plans, according to a new Forrester report.
More media companies will create direct-consumer offerings in 2017, according to "Media Disrupts Itself with New Business Models and Unexpected Partnerships," Forrester's report due to be published on Thursday.
"We will see new partnerships among the digital and traditional ecosystem in the service of what customer want, which will then result in what advertisers want," said Melissa Parrish, co-author of the report and vice president, research director at Forrester.
The streaming model will undercut the media industry's current reliance on cable and satellite to carry their feeds, the report says. It will also give them revenue directly from customers. The direct-to-consumer model is partially growing in popularity because of people being fed up with having to subscribe to multiple services piecemeal to get the things they want to watch, the report added.
Hulu recently signed agreements with Turner, Disney and Fox to carry their shows on its upcoming over-the-top (OTT) service, which will let users stream TV content without having a cable or satellite subscription. AT&T also has plans for an OTT service for DirecTV. In addition, ESPN has announced plans for an OTT service using BAMTech, the MLB Advanced Media (MLBAM) technology company Disney bought a $1 billion minority stake in this August.
About 84 percent of U.S. adults read media content online, while eight out of 10 watch TV, film or video content on digital platforms, according to Forrester. The numbers are 5 and 10 percent higher respectively than percentages recorded in 2015. Media consumption, except for print and magazine readership, has risen overall, and Forrester believes time spend perusing content will continue to increase in 2017.
It also means that we'll be seeing more consolidation in the media industry as companies with distribution seek content to feature on different platforms, Parrish said. AT&T's acquisition of Time Warner will get the ball moving for many other deals, she added.
"The fact that AT&T has fired the first shot across the bow is going to spur those creatives more," Parrish said.
The report also said the best idea for a hot new show might come from ... you. Forrester analysts said there will be more reliance on internal data to create programming, similar to the models used by Netflix and Amazon. The two digital media companies mine customer behavior to figure out what genres people are most likely to watch, and then develop shows and movies based on those insights.
Netflix famously used its data that showed high completion rates for director David Fincher's films and customer preference for Kevin Spacey to pursue "House of Cards." It also helped that the British version of the show also performed well on its platform.