The Streaming Revolution

Get on a train or airplane these days and you’re likely to be surrounded by people watching videos or listening to music on their phones, tapping into vast digital libraries on the internet. It’s a sight we already take for granted, but the streaming revolution that’s made it possible is only just beginning. For consumers, the technologies that allow media to unspool in a steady, continuous flow of data over high-speed connections have provided a leap in convenience and choices. For traditional distributors of entertainment, though, it’s a challenge.

Streaming is rapidly changing how media is bought, how it’s consumed, who profits from it and even how much is made. Thanks in part to streaming, the battered recorded-music industry has posted three years of growth, even as sales of physical formats like CDs have fallen. Revenue from music streaming has skyrocketed in recent years to $4.6 billion globally in 2016. Popular services include Pandora, Apple Music and Spotify, which aims to sell shares in an initial public offering in 2018 and has been valued at as much as $21 billion. Video on demand, meanwhile, was a $45 billion business in 2014, by one estimate. In a 2015 Nielsen survey conducted in 61 countries, about two-thirds of respondents said they streamed video. Netflix has signed up more than 115 million customers worldwide for its on-demand service, while YouTube is the most popular video destination in the world, reaching more than 1 billion people a month. Their success has inspired newspapers, phone companies and social networks to offer streaming video. Original programs offered by streamers almost doubled the number of scripted TV shows that aired in the U.S. from 2009 to 2015, to 417, prompting FX Networks CEO John Landgraf to predict that the country had reached “peak TV.” But the number grew further, to 487 in 2017.