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Netflix is fighting a streaming war and we may get burned

22 May 2019 7:06 PM
Tags:
Digital technology
BusinessUnusual
As more streaming services create the impression of more competition, we may find it just means we all pay more for less.

The best show ever on HBO ended this week. Game of Thrones set all sorts of records. The season finale in episode 7 set a new HBO watch record. It was beaten by the season 8 premiere which was passed by the 3rd episode which saw the Knight King defeated. A new record was set by the penultimate episode, and then as you might imagine the most watched show on HBO ever was the series finale, over 19 million watched it. Piracy numbers, hard to measure accurately, have it as the most pirated TV series ever.

It has won the most Emmys for a fictional show and the second most ever at 38 and over 200 nominations. Only SNL has more although it has had 44 years to win the additional 16 awards. Fans have built the entire landmass of Westeros in Minecraft!

This is not about Game of Thrones though, but rather about original TV and how we watch it. While broadcast TV is still sitting comfortably on the Iron Throne, a streaming service with three dragons is making noises from across the sea.

But like the breaker of chains herself, there is a dark secret the streaming services would prefer us not to know. We will get burned as they or rather the ultimate ruler decides to unleash exclusivity as a way to subjugate us and risk killing the streaming star.

I think I should explain.

The shift in how media is consumed in the US in the last 20 years.

You may think companies like HBO and Netflix are disruptive upstart companies, but Netflix is over 20 years old, and HBO is a ripe old 46.

HBO was a disruptive cable company back in the day, and Netflix was a disruptive video rental company in the late 90s.

It took broadband internet and online subscriptions to turn Netflix into a verb. If you have been using a streaming service and have a stable and uncapped data connection, you may be forgiven for believing you are in movie heaven.

What could be better? More competition? Yes, that is always better, right? DStv, Amazon Prime Video and Showmax are the other services in South Africa. CuriosityStream is another documentary only option. Google and iTunes have TV series and movies to rent and buy.

Between them, you should find anything you want. But a deal in the US saw the Disney company spend over $70 billion to buy the bulk of 21st Century Fox. It is a long list so for simplicity just imagine that everything you loved from Disney, Marvel, Star Wars, The Simpsons, Pixar movies and plenty more blockbusters.

They basically own all the best stuff. To compete, the other streaming services are spending a lot to create new series and movies. That too should be good news, but here is where a quick history lesson might be a good idea.

When the US movie industry began to grow exponentially in the 40s. The issue was not just making great movies, it was where to watch them. Movie studio would show their movies in their cinemas or limit which cinemas near theirs could show the movie when it was released. They used their exclusivity rights to get the most return on their work. That seems fair, but movie fans either had to travel between multiple cinemas, some far away, to watch a show or wait until it was finally available. Regulators ended that by the 50s allowing moviegoers to determine the hit shows and cinemas to show the movies they believed would attract the biggest audiences.

The streaming providers also have exclusivity over the series they create or buy. If you are a fan of Top Gear, now called the Grand Tour, you need to buy an Amazon Prime Video subscription. If you want to watch Game of Thrones, you need to pay for DStv or Showmax if you wish to view the earlier seasons. If you loved Stranger Things, you have to have Netflix.

You see where this is going. You basically need to have a subscription to watch the hit shows and with Disney owning so many the pressure not to let anyone else get hit content is likely to grow.

Your options then are to subscribe to all of them or pirate what you want. Which do you reckon will be the most popular? Piracy had been declining as better quality, and better subscriptions deals have been available, even so, Game of Thrones is the most pirated show. If access and cost become more of a problem, it is fair to assume piracy will climb.

Services like Netflix are popular but margins are tight and profit small. When popularity gets tested, and profit fall, you can bet new big-budget productions will not be the order of the day.

Will it result in just a few big services battling it out or might regulation step in to say exclusives are time-bound, or those creators will need to divest from the streaming distribution? I am not sure, but I have been enjoying ad-free high-quality shows, and the way this story is developing it looks like we are in for a bad ending.

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This article first appeared on 702 : Netflix is fighting a streaming war and we may get burned


22 May 2019 7:06 PM
Tags:
Digital technology
BusinessUnusual

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