• by Karlene Lukovitz  @KLmarketdaily, January 8, 2021

In a development unlikely to please the folks at discovery-driven TiVo or niche-driven Discovery+, former Disney and Discovery execs yesterday announced a new service that will let consumers access and find content from the growing array of smaller video-on-demand services through a paid hub.

The still-in-development subscription service, called Struum, isn’t expected to launch until “early spring.”

But its visibility was instantly high, thanks to the pedigrees of its founders and backers.

As many of you no doubt read, the founders include Lauren DeVillier, former head of product for Discovery Ventures; Eugene Liew, former vice president of product and technology at Disney+; Paul Pastor, former executive vice president of strategy, revenue and operations at Discovery Networks; and Thomas Wadsworth, former lead of advanced product development for Walt Disney Imagineering.

Further enhancing Struum’s buzz and cred factor, former Disney CEO Michael Eisner is an investor through his Tornante Company investment firm. (The investment decision was a “no-brainer,” he told The Wall Street Journal.)

Other investors include Gaingels, which focuses on backing LGBTQ+ founders and allies, and Firstlight Media, a video tech company that is also involved in building Struum’s platform — which uses Microsoft Azure’s cloud-based microservice architecture.

While the walled-fortress giants Netflix, Hulu, Amazon Prime, Apple TV, YouTube, HBO Max and Disney+ own nearly 75% of the streaming distribution landscape, per Nielsen, Struum is strictly focused on what its creators say are more than 250 mass niche and specialty SVOD services “vying to grow their audiences and raise the visibility of their premium offerings.”

And they report that they’ve already made deals with nearly three dozen of those services, collectively representing more than 20,000 TV series, movies and shorts.

No word on the nature of these deals as yet, though taking some percentage of the streamers’ revenue per Struum sign-up, perhaps on a sliding scale based on their volumes, would seem an obvious route.

But how many consumers will be willing to pay for such a streaming discovery/management hub, on top of paying for one or several more mainstream, premium streaming services already?

Well, the model for the venture, ClassPass, has certainly flourished to date.

And presumably, a group with this level of sophistication has done their homework on the potential universe and what pricing level(s) will drive sufficient sign-ups for Struum while helping to bolster the bottom line. Also presumably, the revenue stream consisting of the distribution fees from the services will enable the platform to keep consumer-side fee(s) sufficiently modest, particularly in the early stages.

With the explosion in streaming users and time-spent, consumers’ mounting frustrations with discovery, and growing demand for foreign-language, niche “lifestyle,” reality and other content, including content created for audiences including the Latinx and LGBTQ communities, it certainly sounds promising. (Although we can hope that the still-lingering specter of the last “too-big-to-fail” streaming venture, Quibi, which proved to be the industry’s Titanic, may temper both outside expectations and internal hubris, a least a bit.)     

“With the top-notch content and technology partners, and a team of industry experts we are able to tap into… our goal is to create a best-in-class aggregation solution for consumers,” summed up Pastor, who became chief business officer of Firstlight this past June and now holds the title of CBO for Struum, according to the release.  

Although the reigning streaming powers, including big legacy players still trying to build their new premium SVODs, aren’t likely to hold hands and join forces anytime soon, “aggregation” of various kinds is still likely to be one of the dominant themes in the year ahead.

Indeed, in a blog and a new report, Ampere Analysis Research Director Guy Bisson argues that “compounding,” in the senses of both combining and adding to, will characterize global television throughout 2021.

“The breadth of choice in the streaming market today means compounding (or bundling) multiple streaming services into packages must be the next step in the evolution of the streaming market,” Bisson writes. “This goes beyond simple aggregation on a 'platform' like a Roku stick, Sky Q set-top box or Amazon Fire device.“

“The streaming industry has yet to embrace the combining and discounting of packages of streaming services, [but] this form of compounding seems bound to rise to the fore in the coming year.”

“With AVOD, SVOD and hybrid combining, the broadcast TV space will also increasingly compound in 2021,” he adds. “That means an acceleration of collaborative services allowing broadcast channels to retain competitive edge in the crowded streaming market.”

However, in an additional point that’s no doubt not been lost on either Struum’s entrepreneurs or Discovery Inc., Bisson also notes that “the content offer within single streaming platforms is also likely to increasingly compound in 2021. That means non-niche streaming services looking to combine entertainment content, drama, reality, documentary, news, kids and sport in single services becoming prevalent.”

Such services, in his opinion, “will better meet the demands of the streaming audience.”