The State of TV, Movies & Social Video Today

Streaming video services, which are in even greater demand right now as we find ways to stay safe and sane at home, are no longer just the “new normal.” They are now, without question, the media and entertainment industry’s dominant transformational force. 

Streaming video giants are not alone of course. Traditional live broadcast TV, pay TV, and transactional on-demand download and rental services continue to be major players. But given their increasing takeover of our viewing lives, leading streaming video players Netflix, Amazon, and Google/YouTube now audaciously anoint themselves as being the kingmakers. “We are the new face of the entertainment industry,” they brashly wrote to the White House a few years back. 

Streaming players come in three primary “flavors.” These include “all-you-can-eat” paid subscription video on demand streaming services (“SVOD”), advertising-driven video on demand streaming services (“AVOD”), and virtual multi-channel video programming distributors (“MVPD”) that generally offer stripped down live pay TV-like packages called “skinny bundles” for streaming over the Internet. In contrast, actual, non-virtual traditional cable and satellite MVPDs deliver content across their own network infrastructure.

In this context, what does “TV” even mean anymore in a world where Netflix and other streaming services increasingly blur the lines separating traditional notions of movies and television?  And how do you separate “movies” and “television” from the overall world of video, period? Remember, Netflix releases most of its features online for in-home viewing (so it is TV, right?), but sometimes releases first in theaters (so it is now a movie, right?). 

These are fundamental questions in today’s tech-transformed entertainment world in which bright lines simply no longer exist.

I. THE STATE OF “TELEVISION” TODAY

Let’s at least try to differentiate television and movies as best we can from other forms of video by focusing on their traditional viewing platforms. Consumers no longer just “cut cords.” They increasingly shift their consumption away from the major cable and satellite players to streaming only. The pandemic likely accelerates that trend right now. Live sports, which has done its best to prop up the cable industry, are nowhere to be found amidst the shuttering of virtually all major sporting events. We can now even get our critical live news, like CNN, on a standalone frequently free streaming basis and without the need for a pricey cable package. 

And there’s more. Now, an entire new generation of digital natives -- so-called “cord nevers” -- never sign up for cable and satellite packages in the first place.  Why would they?  New tech-driven media giants like Apple, Amazon, AT&T, Facebook and Google now cater to their every whim and spend billions to drive frequently mobile-first premium video content that become our new form of “television.”  Heads down. Insular. But shareable.

The “Great Streaming Wars” dominate the headlines in today’s “television” world.  And deservedly so.  Yes, Netflix has always faced competitors.  Amazon Prime Video and Hulu being two of those.  But never like this.  Now Disney+, Apple TV+ and a host of other giants battle it out to take Netflix down a peg or two, or several. Each of these behemoths is essentially betting the farm to “win” - i.e., capture and keep our eyeballs and subscription dollars. But can they all scale and be massive winners in this increasingly overrun space?  Of course not. The streaming market is shaking out before our eyes right now.

Meanwhile, where do scores of “smaller” video players go in this goliath-filled world? They go “niche,” relentlessly focusing on passionate audiences underserved in the marketplace.  That’s how horror-focused SVOD Shudder and numerous others can be successful. They can’t be everything to everyone like the behemoths.  Nor should they try to be.  They can be just fine serving their respective “niche” audiences worldwide, because aggregated global niches can become plenty profitable.

II. THE STATE OF THE THEATRICAL MOTION PICTURE BUSINESS TODAY

Even in 2020 B.C., before the pandemic decimated today’s theatrical motion picture business, new streaming realities had already significantly challenged and transformed it. Because it was so easy to stream films at home at a fraction of the cost of going to the movies, everything but movie blockbusters had, like Elvis, already left the building. Our local multiplexes featured the latest Avengers movie on ten of their twenty screens. Squeezed out were “smaller” indie films that either found their homes on content crowded streaming platforms (where they scream out to grab our attention with one tiny thumbnail graphic), or not at all.

So the theatrical business entered the new decade in dire need to evolve, even as it did its best to cling to business models of the past. In particular, theater owners continued to demand that Hollywood studios stick to their traditional “windowing” strategies that required them to release their films in theaters months before they could make them available to our homes. 

But the pandemic changed all that as theaters worldwide closed to avoid the infectious spread. As they closed, the studios – faced with a choice of either shelving new movies or doing their best to monetize them – opened those windows. Fully. Hollywood studios now, for the first time, release major feature films directly to our streaming homes on the same date they would have instead only hit our theaters. And now that windowing genie is out of the bottle, it likely ain’t ever coming back. 

These stark realities that face theater owners are downright existential at this point in a pandemic-transformed world. This is one entertainment sector that must significantly evolve. And I’m not just talking about adding leather recliners and sushi once it is safe to escape our homes again.  Theaters must become entertainment destinations that offer 360-degree “experiences” (pre-show, at-show, and post-show) that cannot be replicated at our homes. In these remarkable times, the sense of urgency cannot be overstated. Disney’s early 2020 partnership with Secret Cinema points the way. Disney movies will become full-evening events that feature live actors, elaborate unconventional settings, and expensive food and drink, all leading up to the main event – and augmented cinema experience. You simply can’t do that at home.

Theatrical business models also will change.  MoviePass is one example.  Remember that once high-flying upstart and overall Hollywood disruptor?  Its audacity enabled all of us to watch as many movies in theaters as our little hearts desired for a mere $9.99 monthly.  Too good to be true?  Apparently yes (at least for now). MoviePass is gone. But its Netflix-inspired subscription business model most certainly is not.  That new model will find its home as part (rather than the whole) in the subscription business models of others that can withstand its economics. Netflix and Amazon are two prime suspects here.  Each could bundle a theater subscription benefit as an upsell from its standard streaming-only subscription offering. That may now happen sooner than you may think.

So does streaming’s ease, which lures us into our living rooms to “Netflix and chill” – not to mention today’s forced closure of theaters worldwide -- mean that theatrical motion picture experiences are dead? 

Of course not.  We are social creatures after all, and we still crave communal storytelling experiences. In fact, perhaps we need them even more in this increasingly heads down, digitally driven mobile-first age. Out-of-home movie experiences will live on, albeit in different form. 

But for now, as the Coronavirus singles out movie theaters to suffer during our collective lockdown, perhaps the streaming giants that oddly benefit and profit during this pandemic should do something meaningful to ease their pain. 

That counts as innovation too. Of the most meaningful kind.

III. THE STATE OF MOBILE & SOCIAL VIDEO TODAY

We continue to clutch our smart phones – and consume video content on them -- during this age of Coronavirus, of course. Mobile today still remains focused on shorter form, less expensively produced video content on YouTube and other mobile-first platforms (a mass generalization, to be sure).  But we watch more and more of our movies and television (whatever we call them) heads down on our small screens.  The coming onslaught of 5G will accelerate that trend.

Jeffrey Katzenberg’s Quibi is the highest profile mobile-first story for the entertainment industry right now. Quibi hopes to do something never tried before for a mobile-first millennial audience – succeed by building a massively financed business on top of extremely expensive premium content. Quibi’s programming features traditional Hollywood talent and production price tags that rise up to $125,000 per minute. 

Skeptics abound who question whether Quibi’s economics can pencil out.  But one thing’s for sure -- if Jeffrey Katzenberg can’t do it, no one can.  Literally every single major Hollywood studio invested in, and will support, his vision. Quibi, like Netflix and other in-home entertainment players, may benefit from our locked down Coronavirus times. Most of us have more time to check it out. 

 We also now likely have more time to share the video content we like. After all, why enjoy it alone heads down on our smallest of screens when we can at least connect virtually and laugh (or cry) together? So it should be no surprise that every major social media platform now counts itself as being a new media and entertainment company. That means Facebook, Facebook’s “child” Instagram, Snap, Twitter, TikTok and others.  They too now spend billions of dollars on original video programming to keep us glued to our small screens, even as they bombard us with ads and collect our personal data all along the way.  

These social media giants haven’t found their video sweet spots yet, but it’s not for lack of trying. They, like Quibi, hold our attention right now – and should be major beneficiaries of these crazy times.  

[NOTE: This is an excerpt from my new book, Viral Media: Entertainment In The Age Of The Great Pandemic, which I am making available for free here.]