The Big Sweat
Okay, the streaming wars are beginning to look like a land war in Asia, and this war does not seems to have an end in sight. The stumbling of Netflix is causing Hollywood to get a case of the shakes. Like most things for the studios, a sense of myopia ascends and descends frequently within their foolish reactivity of Wall Street. They have repeatedly failed to truly understand the term entertainment ecosystem; a building of the natural order of things. Theatrical exhibition is the foundation of the natural order for any cinematic product.
?In any war there are casualties, and the streaming war is no different. Like most human competitions we all seem to get excited by the potential of a giant stumbling; it provides drama, suspense, and the opportunity of a solid David and Goliath story. When Netflix came on the scene with their red envelopes, Hollywood in its arrogance laughed. Fast forward to the present day and no matter what you want to say about them, they have not done half bad and are probably the largest present-day consumer of content. Now keeping with tradition, I also think they are monopolistic, push down the price of independent content, and have purposefully damaged the theatrical experience.
?I watched Netflix preparing to announce its second-quarter earnings last Tuesday. Netflix floated that they might have lost up to 2 million subscribers. Panic ensued as analysts and their Wall Street master prepared for the worst. At 4 o’clock, after stock trading ended Netflix announced that instead of a two million loss, they only lost 900,000…phew. This was a manipulation and a shaping of market perceptions that I think provided some short-term relief, but in the long run does not bode well.
Netflix remains the world’s largest streamer, but in the early part of this they announced their first loss of subscribers. The problem is for the first time, they are facing some dynamic competition. HBOMAX is offering a real challenge and the looming of Amazon’s “Lord of The Rings” series should make folks at Netflix shake. Like most pioneers they are facing arrows in their backs,
?Netflix is offering its services at a very high price point compared to other offerings. In the face of a possible recession, folks will start making cuts.? That could make it the first option people will consider when thinking about canceling a streaming service. Competition is really heating up. HBOMAX will offer the full range of Discovery offering 6 streams in total. While Disney is shifting its pricing and keeping its bundle, if it weren’t for the Star Wars offerings there would not be much growth
?For some reason, at the beginning of this year it was predicted Netflix would add 17 million subscribers. This was nothing short of unrealistic folly. Netflix has seen a decline value from $300 billion to now $90 million. For a long time streaming has proven itself to be a wild west show with valuations and growth that seem unfettered. Market reality and competition have bitten cruelly on the halcyon days of Netflix and have injected some reality into the market.
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?Unfortunately, we are about to endure a financial re-adjustment. I think companies who have long suckled at the teats of Wall Street are going to have to find themselves re-adjusting their business model as the speculators lose seats because of the game of musical chairs that Wall Street engages in. It is going to be a brave new world, a world that might for the first time in a long time begin to re-embrace reality.
?If the streamers are smart, and frankly the jury is still out, they will start looking carefully at what is truly the business of streaming. Is it binge watchable content? This is expensive but probably necessary for the business of streaming. Does it have endurable value, the answer is probably no. Library titles from studio archives are a necessity. Nostalgia is an imperative in today’s market and you can easily shape a perception of diversity.
?At the end of the day, the streamers have to admit that although maybe not the biggest revenue generator, theatrical titles do increase subscription rates and do provide a perception of deep value .A smart streamer says to themselves….okay a 90 day window, does that? provide a perception of value for my audience….yes it does. Okay, if I can claim some exclusivity does that provide value…yes it does.
?Streaming should be looking at a deep alliance with theatrical divisions at the studios. Netflix should be creating value propositions with Lionsgate and Sony, studios that really do not have their own substantive streaming service.? A value proposition that indeed puts in place a proper window and a re-re-re establishment of the proper respect for the place within a proper movie ecosystem that exhibition should hold.
It is time to demand an ecosystem that respects exhibition.
Musician, Actor, Producer, Filmmaker, Festival Planner, Booking Agent, Film and Black Historian!
2 年O.K. let's look at this from a Brown perspective in terms of diversity! Covid created a digital Rennaissance as I term it where the industry was already losing billions of dollars. Then the birth of streaming as small theaters went out of business & Multiplexes had to adjust! But the economy had a definite effect as the average theater attendee had no money. Even Animation suffered because Grandma & Pa could not afford take their children to the Big Screen & now have reopened but the New Virus strains (Monkey Pox) is rising nationwide. In the beginning the Netflix CEO was focused on True Compelling Stories & Documentaries but has gotten away from that, in my opinion. No one seems to be aware that 57% of theater goers are brown but now have flat screens in their homes, no desire to go to the Big Screen, pinched by inflation, fears of Mass Murders Racially Motivated & lack of Diversity except Black Superhero's like the Black Panther & the Sequel to follow, Low Income struggling to put food on the table suffering with high gas prices, food & consumer confidence dropping for the third straight month since July worst in 40 years. So, no wonder subscriptions have fallen off. Solution, re-establish Drive-in Theaters!