What the rise of at-home cinema means for connected TV

Alex Hole, the European vice-president at Samsung Ads, reflects on the rise of at-home cinema experiences as Disney fast-tracks Mulan to TV for a one-off fee of £19.99.

Home cinema used to be the preserve of the rich and famous, with subterranean, velveteen-clad viewing rooms a feature in at least one of their many gracious homes. But today, with the price of in-home smart TVs and high definition screens dropping as fast as the quality is rising, home cinema is accessible to everyone – and it shows. In late 2019, the full cinema experience at home was expected to grow at a stunning compound annual growth rate (CAGR) of 8.3% between 2019 and 2025. As coronavirus shut cinema and theatre doors, that just accelerated it even more.

Streaming services that were already enjoying strong year on year growth gained an extra boost in viewership as Netflix and Amazon Prime became a key escape route from the stress of Covid-19. Ofcom noted that the UK population was spending 40% of their day watching TV and online video, spending twice as much time on streaming services than usual and that 12 million people adopted a new video streaming service during lockdown, 3 million of which were first-time streamers. The brand new Disney+ streaming service alone gained around 55 million subscribers in five months.

In fact, first-party data from millions of Samsung Smart TVs in Europe shows that linear television is making up a smaller and smaller proportion of people’s total TV viewing. Nearly half (42%) of Samsung Smart TV households in the UK watch less than two hours of linear traditional TV a month, and 14% of them watch none at all. Overall, nearly half of the UK’s viewing public (41%) are what might be termed only light or very light consumers of ‘traditional’ TV programming.

With the cinemas closed, film producers’ initial reaction was to hit pause on major releases in the hope that lockdowns would be short-lived and a return to normal imminent. However, this has not been the case. Gradually, it became clear that the only way to reach cinema audiences for the foreseeable future was to deliver the releases via over the top (OTT) services, direct into viewers’ own homes, on-demand.

Several cinematic but now streaming releases have already tested the waters, aimed at a variety of different audiences, including Endings, Beginnings, Scoob! and the record-breaking Trolls World Tour. Film watching at home has indeed grown in popularity. We saw from our own first-party data from Samsung Smart TVs that, in June, the time spent watching films on linear TV increased by 18% v January to 7 hours a week. We also saw that time spent streaming increased by 36% to 16 hours 48 minutes a week in the first half of 2020. But the announcement that late summer blockbuster Mulan would be joining the streamers by showing on Disney+ for $30 (£19.99) in the US from 4 September has disconcerted some in the UK cinema industry.

In particular, they are concerned that by joining the direct-to-streaming cohort, this will add to the pressure on an already beleaguered cinema sector which, though now open, have only seen box office takings around 3% of the same weekend the year before. Disney is reported to have said that the film will not go direct to streaming in countries where cinemas are open, however, there is an argument to say that traditional and OTT platforms can coexist in a mutually beneficial arrangement. In the US, AMC Theaters continues to face challenges brought by the pandemic, but it is working with digital rental services such as Amazon to allow the platforms to stream films by Universal Pictures just 17 days after they show on screens.

The films will stay in theatres for those who still want to enjoy the full cinema-going experience, but those audiences who have developed a taste for in-home cinema won’t have to wait too long. AMC will receive some of those in-home revenues as part of the deal.

As connected TV becomes accessible to more audiences, content producers, platforms and advertisers all have an opportunity to build on new trends of entertainment consumption. Rather than restrictive policies that limit consumer choice, the new cinematic streaming trend is opening up the landscape for new, innovative ways of building customer relationships and creating commercial partnerships that make the most of the incredible in-home entertainment technologies available on the market.

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