In the not-too-distant future consumers around the world including Australia will be able to buy content direct from the US studios and indie producers, bypassing TV broadcasters.

The rigid gap between theatrical and home entertainment release windows will disappear.

Free-to-air broadcasters will look to offer programming via their own over-the-top (OTT) streaming services.

That scenario is predicted by Jeffrey Cole, director of the University of Southern California's Annenberg Center for the Digital Future.

Dr. Cole, who founded and directs the World Internet Project, a long-term look at the effects of computer and Internet technology in more than  25 countries, is in Sydney this week talking to media executives including Foxtel, Telstra, the Seven Network and Fairfax.

He visits Oz five or six times a year and speaks knowledgeably about the fast-changing media landscape here and globally. He's been a regular visitor for 12 years; Wesfarmers is a client.

“This is a period of intense experimentation,” he tells IF. “In the US we have seen the unbundling of cable channels and we will see the end of the bundling of programming on terrestrial channels around the world. People will be able to buy programming independent of the networks.

“TV guides don’t matter anymore. Millennials no longer watch TV but they consume content on numerous devices. In the US very few people under 40 watch live or linear TV, except for sport.

“OTT will become one of the most important distribution modes, if not the most important, and will be mostly advertiser-supported. We will see free-to-air broadcasters launching OTT services although they will not give up on linear TV for maybe 15-20 years.

“Studios and networks will find that the cost of producing 22 episodes is not sustainable in the long term.”

Dr Cole praises Foxtel for responding to the disrupted media environment better than most US cable companies by re-packaging and dropping its subscription fees.

While he admires Netflix, he observes the streaming giant is facing increasing competition in the US from HBO Now and Amazon Prime Instant Video.

He also voices concern about Netflix grappling with the challenge of producing local content for international audiences. As an example, he cites Marco Polo, the historical series produced by The Weinstein Company for Netflix, which he said encountered “rough going.” Nonetheless Netflix has ordered a second series.

In the US Amazon is commissioning original content such as Transparent, Bosch and Mozart in the Jungle to add to its library of thousands of hours of film and TV programming.

Dr Cole expects Amazon Prime Instant Video to launch in Australia in the next 1-2 years and says, “They have immensely deep pockets; they will be a fierce competitor.”

Asked if he believes Australia is large enough to support Netflix, Stan and Presto TV and Presto Movies, he postulates that only one major Australian SVOD player will remain in the medium term.

As for distribution windows, he predicts, “They will be gone in a couple of years. Studios are chomping at the bit to release films day-and-date. The only thing holding them back is legacy relationships with theatre owners.”

 

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