Executive Summary

Last year was not a banner year for the video industry. Some of the biggest players fell short of revenue and subscriber goals, leading to executive shuffles and an urgent refocus on the bottom line. General economic uncertainty only compounded those pressures, while cutthroat competition raised the stakes for streaming services across the board. Still, digital video remains a healthy industry, with strong prospects for continued growth and innovation.

KEY POINTS THIS REPORT WILL EXPLORE

1. Ad-supported video is having a moment. Disney+ and Netflix finally jumped on the ad-supported bandwagon after resisting for years, and not a moment too soon. Consumers are tightening their spending, so low-cost and free ad-supported streaming make sense. The fortunes of streaming services with ad tiers are rising, and our latest forecasts reflect that.
2. Video and connected TV (CTV) are eating TV’s lunch—and dinner. Time spent on digital video will surpass TV for the first time this year, and there’s no looking back. CTV time is also racing ahead of its analog counterpart as cord-cutting rages on. These trends aren’t new, but our forecasts show recent or imminent tipping points that leave no doubt as to where things are headed.
3. The pivot to profitability has implications. The financial woes of many streamers in this space, as well as macroeconomic turbulence in 2022, have forced the industry to focus more on the bottom line. This has meant layoffs, leadership changes, and more circumspect content investments. Q1 2023 marks the beginning of a new era.

KEY STAT: The biggest gains in US viewership are happening on ad-supported platforms, whether on-demand or livestream.