It may not be noticeable when we plop down on the couch and turn on Netflix, but the golden age of streaming entertainment may be over. We probably won’t like what happens next.
Soon, we may be paying more for fewer good options, nostalgic for the old days of limitless streaming binge drinking and annoying commercials.
A brief explanation for this change in atmosphere: There has been a slight loss of faith in the growth potential of streaming, and doubt has deep ripple effects.
It started with Netflix and its surprise disclosure earlier this year that it lost followers for the first time in a decade. Netflix made the announcement on Tuesday. he shrunk again, although not as much as predicted. Netflix co-CEO Reed Hastings described the company’s business results as “less bad”.
When the streaming leader began to stumble, it raised massive questions about streaming services in general.
Entertainment investors and corporate bosses have begun to take seriously issues such as: Worst business than cable TV? What if we overestimate the number of people willing to pay for streaming or misjudge how quickly they change their habits?
Streaming remains the future of entertainment, but, as i already wrotethe future does not necessarily come in a straight line.
One investment analyst told my colleague Nicole Sperling that he believes the total potential market for Netflix could be 400 million customers worldwide, rather than the 1 billion that Netflix has long claimed. If Netflix’s potential isn’t as great as the company envisioned, or if it takes longer to reach it, it’s not just Netflix’s problem. It also shows that streaming may never get as big as the optimists thought.
We don’t always have to worry when a rich company goes crazy for not growing and growing as fast as we’d like. But this is different: we have benefited from reckless streaming optimism, and the potential mismatch between entertainment companies’ expectations and reality will affect us.
Over the past decade, companies such as Netflix, Disney, HBO, Comcast, Apple and Amazon have scatter money, mostly without profit, in order to attract customers for their streaming services. All that money has most likely brought us cheaper, better quality video streaming services than we would have if it wasn’t for so much hope that these entertainment services have a huge and lucrative potential audience.
If we had fun when hopes for streaming were high, now that the industry doubts his own optimism.
Netflix and other companies say they’re still confident, but they’re not behaving like that. Netflix said on Tuesday that by spending a lot and then a lot of money creating or buying entertainment over the long term, it will keep its programming budget at roughly the same level for the next few years.
Money-caution at Netflix is a new take, and Netflix is not alone. The journalists were busy reporting budget cuts around the streaming industry and canceling shows to save money. “The days of drunken sailors wasting money are over,” one entertainment agent recently said. said Lucas Shaw, Bloomberg News Correspondent.
(Honestly, drunken sailors still spend money, especially companies like Apple, who have goals for their streaming services other than making a profit.)
We all will soon begin to see the consequences of this rigorous streaming phase, if we haven’t already. If you’ve been wondering why Netflix and some other streaming services release series episodes one at a time or in batches rather than all at once for our unbridled enjoyment, it’s partly the result of worry about growth. Netflix wants you to subscribe for months to watch the new season of Stranger Things, instead of watching all the new episodes on weekends and then canceling your subscription.
Companies concerned about their growth may release fewer “wow” programs or charge higher prices than we’re used to. Netflix is starting to pushpaid exchange ”subscriptions, a euphemism for charging extra for those people who now share the same Netflix password with six cousins and a pizza delivery man. When Netflix was confident in its growth, it basically ignored account sharing. Not anymore.
Inexpensive ad-supported streaming subscriptions have been popular with Hulu and HBO Max, and Netflix will try them too. This is an opportunity for us to pay less, but they are also confirmation that the relatively inexpensive ad-free entertainment smorgasbord is likely behind us.
Perhaps this sadder phase for streaming is a surge. Let’s see. But it’s amazing to see how much has already changed since streaming companies that assumed they would continue to grow rapidly for a long time are faced with the possibility that they were wrong.
Before we go…
Owning a starter stock can be a burden: Start-up workers regularly borrow money using the value of their employer’s stock as collateral. My Colleague Erin Griffith wrote about fears that a downturn in the startup economy could saddle employees with loans or tax bills they can’t afford.
If anyone can make a face-worn computer desirable, it’s Apple.: Vanessa Friedman, fashion critic for The New York Times, says Apple’s design sensibility was important in the spread of smartphones and other technologies. She wonders who’s next to champion design at Apple and make “entering the metaverse trendy.”
How to keep gadgets cool when it’s hot: Frozen peas, good. hot car in july, bad. Check out more hot weather smartphone tips from The Washington Post. (Subscription may be required.)
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