“What’s past is prologue.”
The Tempest, act 2, scene 1
“The past isn’t dead.
It isn’t even the past.” William
Faulkner
Once upon a time, in a far away era called the 20th
century, a new form of entertainment arose called television. Despite the vast resources available, and
vast fortunes to be made, there were only three networks (let’s just forget
about the Dumont network, okay?). And so
it was for many decades until Rupert Murdoch said, “Let there be FOX,” and lo,
there was a fourth network. And all was
good, until the rise of cable, and premium channels, and DVDs, and streaming.
The monolith that had been “broadcast TV” broke wide open,
and suddenly there was a din of voices in the ether, all competing for
attention. Where once TV shows needed an
audience of 10 million to survive, now pulling in less than a million in the
right demographic kept the lights on.
But despite the seeming chaos, there was one force that brought cohesion
to the world of televised entertainment; one force that enabled people to have
one portal for most (but not all) of their entertainment needs.
I am, of course, referring to Netflix.
Netflix has acted as a cohesive agent, being a portal for
almost all movies and a lot of TV shows for the past several years. If you are a curmudgeon who finds going to a
movie theater annoying, just wait and you can either stream or get the DVD in
the mail a few weeks after the film closed (and films don’t linger in theaters
the way they used to). TV series from
all the networks were available. In the
ocean of visual entertainment, Netflix was your one-stop place to get not quite
but almost everything.
But the writing is on the wall, and soon streaming services
will resemble the plethora of channels you see listed on your cable directory
that you’ve never heard of. First Hulu,
then Amazon Prime, rose as alternatives to Netflix. Okay, three sources aren’t that bad. Then Netflix announced that they were aiming
at making most of their content “original” content, and in 2018 they
spent more on original content than acquired content. To me, this meant
that if I wanted access to long gone TV shows, Netflix wasn’t going to try and
outbid Hulu for them. That was the first
crack I noticed in the Netflix monolith.
The huge iceberg on the horizon, though, was the threat of a
Disney streaming service. In 2017,
Disney announced that when they started their own streaming service, Netflix
could kiss Marvel and Star Wars goodbye. In 2019, Disney has fulfilled its promise and
has announced that the
most popular film in history, Avengers Endgame, will not be available on
Netflix. So now there is Netflix,
Hulu, Amazon Prime, and Disney+ (please ignore the fact that Disney
is also in control of Hulu).
But there is also the fact that every network has their
programs available as on-line content. And
with media corporate mergers, media companies that once had small on-line
content now are subsidiaries of conglomerates with lots of on-line
content. Increasingly, everyone will
want to control their own on-line footprint instead of letting Netflix make
money off of it.
Netflix used to be the one-stop place to go for streaming
services. But then Hulu arose to mainly carry TV series, but also to
develop shows like The Handmaid’s Tale. Then came Amazon Prime, and then
CBS All-Access, and now Disney+. Now that Netflix is no longer a
monolith, will networks still be willing to sell the rights to their shows to
them, or will they keep them on their own streaming platform, or on Hulu?
One survey found that nearly half of subscribers between 18 and 29 would drop Netflix if
it lost The Office and Friends along with the Marvel content (28% said they’d
drop it if it lost Marvel, which is about to happen). The default, as far
as subscribing to streaming services, used to be “Netflix and . . . “ but in
the new Balkanized universe it might be “Netflix or . . . .” Before, I
might do Netflix and Hulu, or Netflix and Amazon, but with so many options I
might do Hulu and Disney+, or Amazon and CBS All Access. This might be
why Netflix chose to focus on original programming; it knew at some point the
non-original programming would migrate to other streamers.
Or maybe the universe will re-order itself. In a
marketplace of multiple streaming services, will someone like Roku sell bundles
of streamers? That is, create a marketplace where you can choose from among various
streamers and pay one bill instead of subscribing separately.
This is the accordion theory of organization—first options contract and there
is only Netflix, then they expand, and multiple streamers enter the market and
things become confusing, then in order to avoid competition the streamers start
getting bundled together or buy each other up until there are fewer
option. Wash, rinse, repeat.
This sort of reminds me the shift that took place in the
economics of TV networks. For years, local affiliates paid the networks
in order to gain access to their content; then at some point networks had to
start paying affiliates in order to gain access to their audiences. At
first creators of content were eager to sell their wares to Netflix for access
to Netflix’s vast subscriber base, but now everyone wants to have their own
streaming service and Netflix is left to become a content creator to fill the
void.
I don’t know how this will ultimately work out. It was
convenient having Netflix being the premier streaming service, just like having
three major networks made picking shows to watch simpler. How people
choose to watch content on their TV screens will be resolved through a
combination of economics and technology. Will the technology ever exist
where we can choose WHICH of the 500 cable channels we want to buy? Will
it ever be economically feasible for someone to offer an “a la carte” menu for
channels instead of forcing customers to buy content they don’t want?
The trend has always been for increasing amounts of customer
control, so maybe buying only cable channels we want to pay for is only a few
years away. Then after we get that, Detroit can start working on those
flying cars we’ve been promised for decades.
