No more Netflix and Chill
Streaming TV may never again be as simple, or as affordable, as it is now.
Disney and WarnerMedia, are each launching their own streaming services in 2019, in a challenge to Netflix's dominance. Netflix viewers will no longer be able to watch hit movies such as Black Panther or Moana, which will soon reside on Disney's subscription service. WarnerMedia, a unit of AT&T, will also soon have its own service to showcase its library of blockbuster films and HBO series.
Consumers will have to decide between paying more each month or losing access to some of their favourite dramas, comedies, musicals and action flicks.
"There's definitely a lot of change coming," said Paul Verna at eMarketer, a digital research company. "People will have more choices of what to stream, but at the same time, the market is already fragmented and intimidating and it is only going to get more so."
Media companies are seeking to capitalise on the popularity and profitability of streaming. But by fragmenting the market, they're also narrowing the once wide selection that fuelled the rise of Internet-based video.
Disney Plus is set to launch late next year, with new Marvel and Star Wars programming, along with its library of animated and live-action movies and shows. AT&T plans a three-tier offering from WarnerMedia, with a slate of new and library content centred around the existing HBO streaming app.
Individual channels, such as Fox, ESPN, CBS and Showtime, are also getting into the act. Research group TDG predicts that every major TV network will launch a direct-to-consumer streaming service in the next five years.
Netflix and others have invested heavily in original movies and TV shows, to keep their customers loyal. Netflix, for instance, said Wednesday that 45 million subscriber accounts worldwide, watched the Sandra Bullock thriller Bird Box, during its first seven days on the service, the biggest first-week success of any movie made for the company's nearly 12-year-old streaming service.
But Netflix, Hulu and others may soon have to do without programs and movies licensed from their soon-to-be rivals. In December, Netflix paid a reported US$100 million to continue licensing Friends from WarnerMedia.
Why are media companies looking to get in? Data and dollars. Sure, they get money when they sell their programs to other services like Netflix. But starting their own service allows networks and studios access to valuable data about who is binging on their shows.
The business model that some networks and content companies are currently using, distributing their TV shows and movies only by licensing them to streaming platforms, is getting "disrupted aggressively" as more companies launch their own services, said Stephenson, whose company acquired WarnerMedia in June.
Forrester analyst Jim Nail said, "Big brands like Disney have to evaluate: Are we only going to access this market by licensing our content to Netflix, Hulu and others?" he said. "Or, can we go direct to the consumer with our own service?"
But a multiplicity of streaming services could easily overwhelm or confuse consumers. To get a full slate of programming, TV watchers may soon have to subscribe to several services instead of just one or two.
The cost of multiple streaming services could quickly approach the average cost of a cable bill — not counting the cost of Internet service.
Companies are already trying to tame this chaos by bundling multiple streaming services together. Amazon Prime customers can add-on subscriptions to HBO, Showtime or Starz. Roku and Chromecast viewers can access their different services from a central place; Roku said Wednesday it will start selling in-app access to Showtime, Starz and other channels as well.
How should consumers deal with all the coming change?
"Be patient," said Michael Greeson, president of research group TDG. "We're in a time of dramatic change for the TV and video business. There'll be great benefits, and question marks and consequences."