Entertaining the Netflix generation

In eight years’ time, ‘Generation Choice’ turns 21. With the NBN at their fingertips, content providers will have to try harder than ever to keep their attention.

In 2022, ‘Generation Choice’ turns 21. That's the generation that wants to select and consume content at a time and device of their choosing; and looks likely to redefine the future of mass media.

The release of iTunes in 2001 proved to be the catalyst for this generation. From that point on, free-to-air and cable channels were no longer allowed to dictate to consumers how and when entertainment should be consumed.

The iPhone came six years later, and the iPad four years after that. The seismic shift, set in motion in 2001, is now challenging the primacy of traditional business models. By 2022, the challenge could well become an ultimatum. 

So what will the entertainment market look like when 'Generation Choice' starts calling the shots?

Universal copyright licensing

Paul Gordon of Finlaysons law firm says that by 2022 the National Broadband Network will be connected and the increased bandwidth will mean content will be available instantaneously across a plethora of devices,both in and out of the home. 

“Companies are going to be forced to accept the advent of streaming,” said Mr Gordon. “Things like Netflix for TV and movie content is going to be second nature to everyone. “

Streaming books on devices like the Kindle and streaming radio will also be commonplace.

As a result, content providers will have to readjust their revenue models and focus on what additional content they can provide.

“The movie itself is not going to be enough to get people to buy it, when they can stream on Netflix,” says Gordon.

“Generation Choice is going to be increasingly selective in how they get their movies. They’re not satisfied having it in only one form, they want to watch it on their iPad, phone, TV set. They’re going to want to be able to take their playlists from one country to another. “

Gordon predicts a move towards universal licensing of copyright, with content providers forming bilateral relations that allow customers to transport content from one place to another.

“That’s going to challenge current pricing models and how people distribute their content,” he says.

Retro revival

Intel researcher Genevieve Bell, meanwhile, expects a resurgence of “retro stuff” in 2022. 

“The cohorts coming of age during the time of CDs and early mp3 files made vinyl sexy again,” Bell says. 

“The fact that Daft Punk sold more Vinyl than mp3s in 2013 is fascinating, the question will be about what things Generation Choice will revive."

"There’s a strong argument that if you want to distinguish yourself from your parents you reject the stuff they’re doing and start using the staff your grandparents were used to. Perhaps it will be mix tapes or super8 movies,” Bell adds.

The fact is, says the futurist, physical stuff is going to matter again, particularly as the economy begins to skew towards digital.

“That’s the reason why the Frankie and Smith Journal and Cereal magazines are so popular at the moment,” says Bell. “People crave beautifully physical objects at a time when everything is digital. “

Do I even need free-to-air TV?

Michael Reede, a lawyer with Allen Overy and the co-author of a recent paper examining the Coalition’s NBN, says the windows between theatrical release, DVD distribution and online will collapse by 2022. 

“As long as those windows are collapsing, you might start to ask yourself, ‘do I even need free-to-air TV?’,” Reede says.

“There will always be a place for high-definition TV over free-to-air spectrum into homes but I think increasingly you will see more people focused on individual, al-a-carte channels and programs. In the same way we’ve seen the music shift its focus from albums to singles, internet video will increasingly focus on individual program rather than channels.”

However, Reede says there will still be a significant role for free-to-air “a) because it’s free and b) because it will keep producing news, sports and local programming which have always been proven to be the keys to the market”.

“It will be important for TV and paid TV to maintain their uniqueness as new players come in and offer new ways of broadcasting premium content over the web,” he says. 

By the time the NBN is up and running, viewing habits and access to new devices will have changed dramatically and at that point there are no technological limits to providing content, Reede says. 

People in their twenties and thirties will be in their thirties and forties, and their viewing habits will have matured. A key sign of that maturity will be the manner in which digitally savvy consumers gravitate towards quality distribution platforms.

No more repeats

But it’s not just Generation Choice that companies should be worried about. Within eight to 10 years about one fifth of the Australian population will be elderly, with the number of people over the age of 65 jumping to about 15-20 per cent of the population, according to economist Stephen Koukoulas. 

According to Koukoulas, this demographic will be a significant consumer of content and entertainment companies will need to work a lot harder to meet their diverse demands.

"Companies are going to have to do more than just make movies like Frozen and have One Direction coming out to do concerts. You have to do something to entertain these oldies. Don’t just put on repeats of The Brady Bunch and Gilligan’s Island – you’ve got to get better content out.”

The NBN is vital to attract entertainment services to Australia to serve the needs of the changing population. Without a high-speed broadband network, “Australia will be condemned to poor quality entertainment”, Koukoulas says. 

Over the next 10 year the Australian population is expected to increase by about four million people, and Koukoulas says the rise in population is likely to drive access to entertainment and economies of scale, making it more viable for new business to enter the Australian market.

“Soon lots of people will be looking to elbow in and take advantage of the big economy. Australia until now has been falling short of that, which is why it’s been so difficult here."

But as the economy gets bigger it will be easier for businesses to come here. In 10 years, with a population of 28 million the Australian market could well be more viable and fertile for the likes of Netflix, Facebook and Google.

No doubt the major tech players have already profiled their future customers and are planning accordingly. Business Spectator asked Netflix about its future consumer projections but it declined to respond, “no matter how fascinating the story is”.

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