The beginning of the Covid-19 pandemic was traumatic for everyone. In a context in which doubts abounded and certainties were scarce, companies in all sectors had to rethink their strategies and goals for the year. The main media groups of the entertainment industry were no exception.
Speaking to Señal News back in April, when the global pandemic was just beginning, Rob Silvershein, Senior Advisor at TDG Research, assured that “there will be no winners in this downturn, only survivors and casualties”. Almost seven months after that, we reach back Silvershein to talk about the current context, in which companies around the world seem to have gotten used to this new normal, although not without a cost.
“Probably the biggest change is that most of us thought that the pandemic would have been behind us by now. Clearly that has not happened. Much of what I have said in my last tesis when I talked about the pandemic has come true, and that is that people streaming more is not always the best news in the world, because that puts a lot of pressure on the studios to have content, which has definitely become a factor and an issue,” Silvershein commented.
The 20-year veteran media executive considers that, on the entertainment side, people are looking for an escape or a diversion. However, on the opposite of that, he sees an increase in the consumption of news on live TV. “People are having these split personalities where they want to watch the news more but when it comes to entertainment, when you ask what content they are looking for, it is definitely something to escape and to go as far away from reality as they can get,” he noted.
The economic cost of the pandemic and the impact on consumers' pockets caused many people in the United States to start choosing more carefully which services they wanted to keep. According to TDG, TV and movie rentals began to slow, as did music services and even the purchase of games.
However, Silvershein believes SVOD services are making a good job in that sense, as they have become almost a habit and are now part of people’s comfort zones. “Netflix, for example, has done a really great job in making sure that you do not feel like you can turn it off and on all the time. They try to have debuts every week, but that, again, presents many content challenges,” he analyzed.
When the pandemic ends, Silvershein is not sure about the future of some of the small companies that were forced to shut down due to the crisis, but he considers that the major groups are going to do fine, especially when they can go back to producing normally. Therefore, although people will reduce their consumption hours as they are going to go back to the office, there will be a lot of new content to watch, and “that is a win for the consumer”.
Lastly, Silvershein is sure that we still are in the middle of this pandemic, but he believes that there has already definitely been a shift. “This is not a short-term thing, this an evolution that is happening faster because of the pandemic. At some point, there is going to be a significant part of the population that is going to go back to work permanently or they will have to find jobs that are not as high paying as they used to be. As a result, there are going to be cut-backs on spending and time on the TV. The competition has got more and more fierce. The companies that are the ‘survivors’ are the bigger and more established ones, as the small ones have gone or being acquired. I believe, although some sectors have benefit from this, like broadband, this is not good for anybody. People are going to have to fight through this,” he concluded.
By Federico Marzullo