If last year’s biggest corporate media challenge was launching subscription streaming services, this year’s issue is figuring out what to put on them.
The debate over how to balance streaming video, theatrical release and linear TV is leading to some difficult choices which are also confusing consumers in what’s becoming an increasingly jumbled landscape.
“The challenge all of these companies are battling — the central question — is what content goes where, who decides, and why?” said Rich Greenfield, a media analyst at LightShed Partners.
Such decisions will ultimately reform how the public consumes its favorite media content. So far, most media companies have marketed streaming video as a complement to traditional pay television.
In the long run, it’s possible each streaming platform will become the home for all of a media company’s programming. ESPN+ may just be ESPN, with everything ESPN has to offer.
But the world isn’t there yet. And the results are increasingly confusing for consumers as new programming is made specifically for streaming services, and much of the content intended for linear TV still doesn’t show up on streaming.
For scripted television series, most media executives have settled on the decision that streaming services will be the home for their highest quality original programming. The likes of Disney, AT&T’s WarnerMedia, Comcast’s NBCUniversal, and ViacomCBS are all attempting to persuade investors they can grow beyond traditional cable television. They’re using new hit shows as bait to entice subscribers. Success has varied for each company, but all of the major new subscription products are growing by millions of customers each quarter.
As far as movies, there’s disagreement at a film-by-film level across the different services. Disney put Pixar movies “Soul” and “Luca” directly on Disney+ for no additional charge upon release. For “Jungle Cruise,” “Black Widow” and “Raya and the Last Dragon,” the company decided to make users spend an additional $30 to stream the movies before eventually making them free. WarnerMedia decided to place its entire slate of 2021 films directly on HBO Max but won’t do that for the forthcoming blockbusters of 2022.
For news and sports, most companies have kept their most valuable programming exclusively on cable. This has allowed executives to push against the growing but not yet crippling surge of pay TV cancellations, keeping the multibillion dollar cable TV package business alive.
“It’s the innovator’s dilemma in action,” said one veteran broadcast television executive. “You know the linear TV world is collapsing, but you’re trying to stay on the Titanic for as long as possible. At the same time, you’re setting up the lifeboats, which are digital and streaming.”
“Nobody is ready to unplug the linear ecosystem, because it brings in so much cash,” said Greenfield, quoted above. “So they’re all balancing how to manage legacy assets with future investments that are free cash flow negative to show Wall Street that they’re trying. They’re all walking the tight rope.”
By CEO Staff
