The streaming landscape is undergoing a seismic shift. For years, the mantra was simple: growth at all costs.now, as household budgets tighten and competition intensifies, streaming services are prioritizing profitability, mirroring a sentiment echoed in the U.S. stock market where investors are rewarding companies demonstrating fiscal discipline.

The industry’s new playbook, revealed at the Connected TV World Summit, hinges on several key strategies: laser-focused content, optimized marketing, strategic partnerships, and enhanced user experiences. The summit,attended by leading content providers and vendors,served as a bellwether for the changing tides in the subscription video on demand (SVOD) market.

Autonomous analyst Ben Keen, who moderated discussions at the summit, highlighted this industry-wide pivot, noting that global streamers are now prioritizing profit over simply amassing subscribers. The question now is: how can more streamers achieve sustainable profitability?

Niche is the New Black: BritBox’s Success Story

Kerry Ball, chief commercial and strategy officer at BritBox International, offered a compelling case study. BritBox, specializing in British television for audiences in the U.S., Canada, Australia, and the nordics, has been profitable since its early days, capitalizing on the burgeoning specialist streaming market, which saw a 24% surge last year.

“We have been focused on building that super-fan level of content experience,” Ball told attendees at the summit. with an extraordinary library of 8,000 titles,BritBox exemplifies the power of “going deep” within a specific niche.

BritBox’s strategy also involves a deep understanding of its target market and ensuring that every marketing dollar is strategically allocated, supported by econometric analysis to maximize effectiveness and maintain reasonable subscriber acquisition costs. This approach contrasts sharply with the “spray and pray” marketing tactics of some larger services, which often result in wasted ad spend.

The Art of Retention: Content Cadence and “Talkability”

Beyond acquisition,retention is paramount. Ball emphasized the importance of a consistent release cadence for new content. “You don’t need everything to be an exclusive or a premiere, but you do need those tentpoles when people come in, before they find everything else in the wheelhouse,” she revealed. “If we can keep a new subscriber for three to four months, we probably have them for a considerable amount of time.” This strategy aligns with viewing habits in the U.S., where binge-watching remains popular, but viewers also appreciate a steady stream of fresh content.

Dr. Malte Probst, chairman, board of directors, and CEO at Swiss Studios, echoed this sentiment, advising streamers to leverage their existing content knowledge and seek content with inherent “talkability.” Though, he cautioned against overspending on launch content, a lesson learned by several U.S. streamers who poured vast sums into initial offerings that failed to deliver long-term subscriber loyalty.

Swiss Studios, launched last year, offers a unique approach to content engagement. “When we have a true story [drama], we create a documentary on the back of that — the story behind the drama,” Probst explained. “If someone joins a subscription service for the first program and they want more, it is easy to recommend the second for more engagement.” This tactic provides viewers with a deeper connection to the content, fostering greater loyalty and reducing churn.

Experience Matters: The IMAX Effect

Thijs Bijleveld, vice-president, head of sales, EMEA and APAC, at Imax, underscored the significance of the viewing experience. Imax’s collaboration with disney+ to enhance the video and audio quality of Marvel Cinematic Universe films during 2023 (on select devices), including the use of imax’s expanded aspect ratio, which delivers 1:90:1 and offers up to 26% more picture for select sequences, demonstrates this principle.

In March 2024, Imax revealed its dominance in cinema, delivering 20% of the global cinema box office takings for Dune: Part Two in its first 12 days. bijleveld believes that the lessons learned in cinemas can be translated to streaming: prioritizing a superior viewing experience enables better monetization, even with a smaller subscriber base.

He drew a parallel to the automotive industry, recalling when automakers began featuring Bose speakers to signal audio quality. Streamers, he argued, could leverage brands like Imax to communicate their commitment to a premium viewing experience as a driver for growth. This is notably relevant in the U.S. market, where consumers are increasingly discerning about picture and sound quality, especially with the proliferation of high-end TVs and audio systems.

Windowing and Bundling: New Strategies for a Crowded Market

The discussion at the Connected TV World Summit also touched upon the evolving strategies of windowing and bundling. Kerry Ball advocated for content creators embracing co-windowing to reduce reliance on a single distribution platform.

Detective drama The Jetty, released concurrently on BritBox and Hulu, exemplifies this approach. Ball noted, “You still need exclusive content and tentpoles, but you can achieve that with other shows that are new to the service. It [non-exclusive windowing] is an opportunity for production companies because a show is more likely to get a second or third season if it is not limited to one platform.” This approach contrasts with the traditional model of exclusive content deals, which can limit a show’s reach and potential revenue.

Vikram Kulkarni, vice-president, strategic initiatives, at Gracenote, emphasized the benefits of hard bundles as a means of boosting the streaming market and providing value to platform aggregators. “Everyone’s IP [intellectual property] and audiences are different, so you have to find the right options and understand consumer thresholds [for what they will pay in a bundle],” Kulkarni observed.

He believes that pay-TV operators can maintain their position as leading aggregators, despite the rise of direct-to-consumer apps and smart TV operating systems. “As streaming offers become more diverse and also more expensive, and more of them are ad-supported, re-aggregation of content becomes compelling for audiences, and pay-TV is well-placed to meet that need,” he stated. Companies like Comcast in the U.S. are already experimenting with bundling streaming services, offering consumers simplified billing and a single point of access to multiple platforms.

The Advertising Question: To Ad or Not to Ad?

The rise of ad-supported tiers (HVOD) represents another notable shift in the streaming landscape. While offering a lower subscription fee, this model requires careful consideration of the user experience.

BritBox, though, remains unconvinced. Ball stated, “Our surveys show customers are reticent to see ads — there is more price elasticity than advertising elasticity.” She added, “We are a specialist service, so we are not focused on acquiring subscribers at all costs but on getting profitable subscribers who stay a long time. We are always evaluating the business proposition, but we would have to be more of a general entertainment play [to pursue the advertising route].” This highlights the importance of understanding a service’s target audience and their tolerance for advertising. In the U.S., some consumers have shown a willingness to accept ads in exchange for lower subscription costs, while others remain staunchly opposed, preferring to pay a premium for an ad-free experience.

Looking Ahead: The Future of Streaming

The streaming industry is at a critical juncture. The era of unchecked growth is over. In 2025, the focus is squarely on profitability.Streamers are adapting by embracing niche content, optimizing marketing spend, exploring windowing and bundling strategies, and carefully considering the role of advertising. The winners in this new landscape will be those who can deliver compelling content, a superior user experience, and a sustainable business model.