Streaming services raise prices to win subscribers and impact on ad tech. Difficulties of data transfer between Europe and the US, privacy themes. Relationship between ad revenue and streaming subscriber growth. Focus on consent and adequacy in data privacy. Revenue per user in different regions, impact of Apple's ATT prompt. Intersection of data privacy and antitrust. Likelihood of more state privacy laws emerging.
Streaming services face a dilemma of prioritizing subscriber numbers or profitability through advertising as raising prices to win subscribers may not benefit the streaming ads business.
Recent changes in data transfer regulations between Europe and the US impact the data privacy landscape, posing challenges for streaming services and digital platforms.
Deep dives
Streaming services struggle to grow subscribers while raising prices
Many streaming services are facing challenges in growing their subscriber base, leading them to raise prices for existing subscribers. This trend of increasing prices raises the question of whether it benefits the streaming ads business or poses a mixed blessing. Some streaming services experiencing the highest growth in ad revenue and profitability are actually losing subscribers, while those with impressive subscriber growth struggle with generating significant advertising revenue. This has created a dilemma for streaming services, forcing them to choose between prioritizing subscriber numbers or profitability through advertising.
Data transfer challenges between Europe and the US
Data transfer between Europe and the US is not a straightforward process due to differences in regulations. Recent changes in how data transfer is regulated have been observed, which impacts the data privacy landscape. The European Union and the US reached an agreement in July regarding the legal transfer of data between the two regions. This agreement aims to ensure that European citizens' data is adequately protected when transferred to the US. However, challenges persist as data protection advocates continue to scrutinize these transfers and pursue legal action.
Struggle for balance between ad load and user experience
Streaming services and digital platforms are grappling to find the right balance between ad load and user experience. Increasing ad load can lead to decreased user engagement, prompting viewers to seek alternatives or become frustrated with repetitive ads. Various streaming services have experienced a growth in ad load over the past year, causing concerns about replicating the ad-heavy experience of traditional linear TV. The challenge lies in finding ad formats and frequencies that strike a balance between generating revenue and preserving the user experience.
Privacy and antitrust complexities intersect in digital advertising
The realms of privacy and antitrust in digital advertising often converge, creating complex legal and regulatory challenges. Companies like Apple and Google face investigations into their privacy practices, with French competition authorities specifically examining the impact of Apple's App Tracking Transparency (ATT) on competition. The interconnectedness of privacy objectives and antitrust concerns presents a tangled web, as moves made to enhance privacy can inadvertently give companies an advantage over third parties. As the industry evolves, regulators will need to navigate these overlapping issues to ensure fair competition and protect user privacy.
Streamers are raising prices amid a challenging environment to win subscribers. Plus: what big changes in data privacy and portability in Europe mean for ad tech.
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