We are in a moment of transition in streaming: user growth is slowing and the main players are seeking to consolidatebut the long-promised dream of profitability finally seems within reach (especially if you are netflix).
Perfect timing, then, for The New York Times interview many of the biggest names in the industry – including Netflix co-CEO Ted Sarandos, Amazon Prime Video head Mike Hopkins, and IAC president Barry Diller – about what they think will come next.
There seemed to be broad agreement on most of the big issues: more ads, higher prices and fewer major changes to prestige television. All of these changes are linked by the shift towards profitability, rather than growth at all costs. If the initial prices of many streaming services seemed unsustainably low at launch, it turns out they were: prices have steadily increased, while streamers have also introduced more affordable subscription tiers for viewers willing to watch ads.
In fact, some executives told The Times that streamers will continue to raise prices for ad-free tiers in order to pressure more customers to sign up for ad-supported subscriptions.
The growth of ad-supported streaming could also affect the types of movies and shows that are produced, as advertisers generally want to reach a mass audience; Think of the heyday of ad-supported television networks, with their endless shows about doctors and police officers. compared to HBO’s more ambitious subscription fare.
That change is already underway in streaming, although executives insist they are not abandoning their hopes of finding the next “Sopranos” or “House of Cards.” Sarandos (who has already been going back of his boast a decade ago that he wanted Netflix “to become HBO before HBO could become us”) said Netflix can “do prestige TV at scale,” but added: “We don’t just do prestige.”
Similarly, Hopkins said that at Prime Video, “procedural and other tried-and-true formats work well for us, but we also need big changes that make customers say ‘Wow, I can’t believe that happened’ and that people tell their friends.'”
Other not-too-surprising predictions include more investment in live sports (“the simplest and most interesting,” according to Warner Bros. Discovery board member John Malone), more bundles, and the closure or merger of some existing services. There was apparently consensus among executives that streamers need at least 200 million subscribers to be “big enough to compete,” as former Disney CEO Bob Chapek put it.
Some of those changes would be welcome, but they reinforce the sense that streaming (at least as envisioned by the executives currently running the business) won’t be all that different from the old cable TV ecosystem. Some things will be better (on-demand viewing), others will be worse (Compensation for writers, actors and other talents.), and there may be different players at the top. But in many ways, it will feel like the same old TV.