Streaming Wars. It’s one of the new buzzwords and the question that is usually asked is who’s going to come out on top. Isn’t the real question though, how are all these providers going to survive? Depending on where you live in the world, you could have a choice of between 5-15 different services, probably more as I’m not considering diaspora streaming in this.
Cord cutting was always said to happen, because end users didn’t want to pay a large amount of money each month, to get hundreds of channels – a number of which they never watched and these were all at a fixed time, or had to be recorded. Then along came Netflix and changed all of that and the era of watch what you want, when you want to watch it was born and the new phrase “binge watching” appeared.
For a while, Netflix and Amazon Prime had the market to themselves, but as soon as the larger content providers saw what was happening, they knew they had to act. The time it has taken them to do something about it, has meant that some of the incumbents have build up a considerable headway and end users, instead of referring to streaming, use Netflix as a generic name, “oh, you mean like Netflix”.
Within Prime, there is content you have to pay for over and above your subscription. As well as that, there are other channels that you end up having to pay for. Sundance, Arrow to name just a couple, You can end up watching a series as part of your Prime subscription; then have to pay out more to watch further series, because another provider has bought the rights to that series and you have to subscribe to that. The series “The Bureau” is a very good example of this.
No one is going to subscribe to all these different streaming providers. They’d never have time to watch all that content for one thing. The other factor here, is if they sign up to 5 or so of them, then their monthly cost in doing so is heading in the same direction as they were previously paying. Ok, they now might have content they actually want to watch, but they still need access to some form of linearTV, or localTV and in many countries around the world, they have to pay for that also.
End result of all of this, is a large monthly bill.
Some of the new entrants, Disney+, Peacock in US, incentivise end users to sign up for 6 months or so. Then what? Are they going to stick around, or cancel the subscription, when they’ve watched what they wanted to watch? Disney has tied in all their popular content to their platform; so if you want to watch the likes of Star Wars, Marvel, in the future, without having to pay elsewhere for it, then Disney+ is the only option. But how many times would you want to watch it and would you keep paying each month to do so, or, are you more likely to dip in and out at some point in the future taking advantage of any incentives that happen to take place?
Unlikely alliances are also taking place. You only have to see what’s happening with Harry Potter movies. Although out of Warner, NBC Universal signed TV & Digital rights in 2016; yet for HBO max launch, these 8 films were all available. However they come off HBO max end of August and will be made available on Peacock at least in the short term. If you’re a Harry Potter fan and signed up to HBO max to watch them, you now have to sign up to Peacock also. Isn’t this part of what it’s all about? Maximise the ways to remove $,€,£ from consumers wallets.
Those that come in at a nice low price to start with, then increase the price on a reasonably regular basis. Principal being that if you sign up while the price is low, then hopefully you’ll stick with it when they increase the price. Some such as Netflix only increase pricing in small increments. If you look at YouTubeTV in US though, then the increase in price there, compared to what it was when launched is significant. They hiked their price this summer from $49.99 per month to $64.99. That’s a 30% increase. Yes, some additional channels have been added, but add too many and increase the price too much and you’ll end up with a bloated offer, where the price is too high. Too early to say if that is going to be a turn off for users, but there must be a point where users say no.
Then the launch of Quibi – is it streaming? Well, yes, but maybe not traditional streaming, but then tradition tends to be change rapidly in this industry. Is the relative failure of Quibi to take off as expected, an indication that the market is becoming saturated and there are only so many streaming services that an end user is prepared to sign up to?
At some point, the end user realises how much he’s paying out each month for all the various TV services and decides it’s too much and something has to go.
It’s likely, over a period of time, that this quite large group of Streaming Companies, will be cut down. I don’t see any subscriber continuing to sign up to more than say 5 services. Personally, I have 3 and that’s enough for me. The recent survey by Hub – Decoding The Default in August 2020, covering US consumers had some very interesting information in, relating to if users had to choose just one service to stay with, what would that service be. This was the result:
| Live TV | 35% |
| Netflix | 32% |
| Hulu | 16% |
| Prime Video | 13% |
| Disney+ | 10% |
When the question was asked about those who stated that one of the above was their streaming solution of choice, only 43% said they would retain Disney+. Something for Disney to consider there.
It’s not therefore who wins the Streaming Wars, but who survives it. It won’t necessarily be those who throw money at it either and some of these Streaming providers could lose an awful lot of money if they think they can buy success.