Broadband Access Drives Changes to Entertainment Model

As broadband further expands, streaming entertainment will adapt, but the consumer entertainment market will continue to transform

As American consumers favor new forms of entertainment, it’s shifting the broader media landscape. Cordcutting is the most common example of how television is evolving, but that’s not the only change. As traditional television viewing declines, video games and e-sports are soaring in popularity. The widespread availability of broadband and highly anticipated launch of 5G is rapidly transforming entertainment as a whole, with more emphasis on mobile video, gaming, and streaming.

The number of Americans with broadband service at home is approaching 75%. Consumers without broadband access are more likely to pursue other types of entertainment because of the bandwidth demands of gaming and streaming.

Young U.S. consumers more likely to have gaming subscription than TV subscription

The diversity of games available and the social nature of gaming are driving a rise in subscription services like Xbox Game Pass. According to a survey conducted by Deloitte, gaming is so popular that it’s more common for 23-36-year-olds to have a video game subscription than a traditional paid TV service. For this age group, the interactivity of games outweighs the passive appeal of a scripted show.

Every gaming provider has a streaming service

The massive popularity spawned a revolution in gaming, with almost every gaming provider joining the streaming revolution. Entertainment Arts launched EA Access in 2014 but recently expanded the service to the PlayStation. EA’s library includes games like FIFA 18, Madden NFL 19, The Sims 4, Star Wars Battlefront II, and more.

Apple announced Apple Arcade in March. The new mobile and Mac gaming subscription service is a bit different than the standard “Netflix-for-gaming” approach. With more than 100 exclusive-to-Apple titles and a curated list that updates monthly, gamers have high expectations of the collection set to launch this fall.

Not getting left behind, Google also announced its new browser-based video game streaming service in March. If it launches on time in September, it will be the first major game streaming service to be platform independent, with 4K 60fps games powered by Google data centers. The new service, Stadia, is intended to work on multiple devices like Apple’s Arcade, giving both services a head start combatting industry giants Xbox and EA.

E-sports is building a following

Video games are growing in popularity as people play more, but that’s not the only reason. Platforms like YouTube and Twitch spawned large groups of people who like to watch others play games like World of Warcraft and League of Legends. Gaming enthusiasts cite the social ties and communities of fans and players for the packed stadiums and online followers in tournament style competitions of e-sports.

As amateur and professional leagues become mainstream, e-sports have been featured alongside traditional sports in multinational events. The International Olympic Committee even explored incorporating gaming into future Olympic competitions but did not determine including the new wave of sports.

The majority of young Americans are cordcutters

Handheld devices now outpace more traditional means of accessing the web like a computer. More than 45% of smartphone owners report that their phone is the first device they pick up to access the internet. The trend toward mobile is part of the broader shift of media that has changed the way people do everything from buying groceries to looking for a job.

A new Pew Research Center survey finds that 37% of U.S. adults say they most often use a smartphone when accessing the internet. But as we’re predicting trends in future behavior, it makes more sense to look at the habits of younger viewers. That’s where the figure becomes remarkable – 58% of young consumers use their smartphone to access the Internet.

Streaming and mobile video more popular than traditional TV

If not involved in a game where speed is critical, young adults are more likely to watch programming on their phones than on television. Pew Research says only 5% of young adults in the US mainly watch TV with a digital antenna, while 60% watch television via streaming services. According to Leichtman Research Group, most consumers (69%) have access to Netflix, Amazon Prime, or Hulu, and many (43%) watch more than one service.

Mobile video appeals to this crowd because they’re on the move. During a train ride or between classes, young adults are more likely to watch a short video than commit to a 60-minute drama. Scripted and reality-based episodes engage viewers with taps and swipe navigation. Twitch and YouTube capitalize on user-generated content, but there are also original scripted series and docuseries on Snapchat and Instagram.

Comcast and other providers still rake in plenty of profits

Although many publications predict gloom and doom for pay-TV providers like Comcast, the company is benefitting from the infrastructure investments by selling high-speed internet. Comcast reports that it sees plenty of profits from charging for faster internet speeds and exceeding bandwidth allotments.

Until 5G access is widespread, the profitability of broadband providers like cable companies is assured. Data caps and other bundling strategies will keep them in the black even as their subscriber losses mount.

Broadband is the driving factor behind the entertainment revolution

There is a broad revolution in entertainment underway, and it’s driven by broadband adoption. It’s not just that people are getting rid of their cable or satellite subscriptions, they’re accessing programs on smaller devices that don’t follow the traditional rules of television programming. The average non-sports broadcast show no longer pulls in a large audience. Nielsen ratings show that all four major broadcast networks are losing 18-49-year-old viewers.

The industry is scrambling to identify the new form of content that appeals to younger mobile viewers, but the explosion of interactive programming options is more likely to expand than to find a common center. As broadband further expands, streaming entertainment will adapt, but the consumer entertainment market will continue to transform.

Megan Southard


Article Author

Megan Southard is a writer, mom, technology enthusiast, and movie junkie. She dreads the day her kids have to explain gadgets to her and is old enough to say, "I was the remote for our TV growing up.

Disclaimer: This article may have had additional images, links or data that was added by this site's editor.

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