Mobile Monday: Is Netflix Still on Top, Gen Z Wants Brands in the Metaverse, and More Content Regulation from the EU
Digital Turbine is constantly keeping tabs on the mobile world, and every week, we’re sharing the most interesting and important need-to-know stories and articles. In this edition of Mobile Monday, the stories we’re covering are Netflix’s latest subscriber loss, how Gen Z really feels about the metaverse, and the latest content regulation policies from the European Union. Learn all about these stories in this week’s Mobile Monday!
Islands in the Stream(ing Video)
Much was made last week of Netflix subscriber loss — at 200,000 subscribers after they had predicted a gain of 2.5 million. The streaming giant’s miss caused its stock to plunge amid concerns of losing traction in the market — with other apps recording big gains. However, Netflix still has a substantial lead in the overall market with a 39% market share (Hulu is second at 18% and Disney+ is a close third at 17%). With more services flooding a market once dominated by Netflix and Hulu (as recently as four years ago, the two combined for an 80% market share), more entrants has meant more options. And with more options, people will choose the content they like best.
Netflix still puts out quality, exclusive content (my wife and I just started Season 4 of Ozark last night!) which should ensure they maintain a healthy share of the market. But much like Marty and Wendy Byrde, competition can come from anywhere at any time. What might be more concerning about Netflix is less about the subscriber loss (in fact, leaving the Russian market was responsible for a 700k loss alone) and more because the once leaders of innovation in video seem to have no bold innovations on the horizon.
In response to the subscriber loss, the company announced plans to crack password sharing and add a commercial tier to their service. Both of these seem like very reactionary moves in nature, and neither seem like an industry game changer. While we still wonder if the company that grew from a mail order DVD service to a household name that toppled Blockbuster and took a bite out of Hollywood has something else up its sleeves, the good news is that none of the other companies have radically changed the streaming playing field either. As the article points out “new releases, events, and exclusive deals are ultimately what’s driving users to flock to some platforms over others.” If that continues to be the case, Netflix will still maintain a healthy market share simply because they have enough regular exclusive content that people love.
Gen Z Wants to Spend Money on Brands in the Metaverse
The metaverse is shaping out to be the perfect place to reach consumers, especially Gen Z, according to new research from Razorfish and Vice Media. More than any other generation, Gen Z spends twice as much time with friends in the metaverse than in real life, feels like the metaverse allows them to express themselves, and builds meaningful connections with peers and brands in this space.
Consumers in Gen Z feel comfortable spending money in the metaverse; currently, 15% of their “fun budget” goes to the metaverse, and that is expected to rise to 20% in the next five years. Consumers want to buy products and experiences that provide entertainment and unique qualities to the game and that match the game experience. Concerts in Fortnite from Travis Scott, songs from Megan Thee Stallion, and branded skins and character add-ons are hot purchase items for this generation in the metaverse. The top products/experiences purchased include, “things that help me express myself, things that help me learn, and things that help me one-up other players,” according to the study.
Whereas in some advertising spaces consumers feel that brands are interfering with their activities, quite the opposite is true for the metaverse. Gen Z wants brands in the metaverse and feel that they add value to their games. This generation is looking for more virtual stores and ways to customize their characters with branded skins and additional items. Brands that can enter the metaverse with products and experiences that match the game style and desires of consumers have the opportunity to increase engagement, especially with Gen Z, and make meaningful, long-lasting connections with a diverse audience.
EU’s Pushback on Big Tech — Round 2
Just weeks after the European Parliament and Council negotiators agreed on new EU rules to “limit the market power of big online platforms” with the Digital Markets Act (DMA), EU lawmakers also reached a political agreement to promote the Digital Services Act (DSA). While the focus of the DMA is on the competitive power of the largest digital platforms, the primary focus of the DSA is on content.
The DMA is focused on certain aspects of the digital market, namely on regulatory efforts to weaken the hold of the “giants,” like Apple and Google, on the high-margin app market, where they take fees of up to 30% from large app developers.
The DSA, however, seeks to battle misinformation and end the current self-regulation era. The new legislation will require companies to more aggressively police their platforms for illicit content — or risk huge fines. The tech platforms will be held accountable, compelled to set up policies and processes to get rid of flagged terrorist propaganda, hate speech, and other materials deemed illegal by European nation states. Another major step included in the DSA is “algorithmic accountability,” where platforms that use algorithms to determine what content users see will be obligated to provide at least one option that is not based on profiling.
The DSA and DMA represent Europe’s aspiration to set the standard for tech regulation globally. The Europeans are putting a specific emphasis on anti-competitive behavior and social media misinformation’s effect on political and societal situations. Both legislative acts are still in the works and are expected to be finally approved and rolled out in the upcoming year.
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Mobile Monday examines the latest news, trends, and developments in mobile apps, tech, and advertising. Do you have a story to share for the next Mobile Monday?
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