Still watching but spending less
The Future. For the last few years, an endless buffet of streaming content has fed consumers’ appetites for entertainment. Streaming isn’t going away, but the days of lavish content spending might be over as companies trying to compete with OG streamer Netflix find themselves in the red.
A return to old media
Streaming services are trying to recoup their losses.
- Netflix grossed almost $5 billion in the first three quarters of 2022, while its competitors Disney+ lost over $2 billion, Peacock around $1.5 billion, and Paramount+ a little over $1 billion, reports Vox.
- To recover from these losses, streaming services are making moves that traditional media companies made before Netflix disrupted the industry.
- Almost every streamer either has introduced or is introducing an ad-supported product – after many of them vowed to never do that.
- They’re also consolidating into a few big players due to the high costs of running a streaming service, especially at the beginning. Warner Bros. Discovery is about to launch a yet-to-be-named service that will merge HBO Max and Discovery Plus.
Insiders joke that Apple and Amazon are unlikely to experience any spending restraints since Hollywood is basically their side hustle. However, news of impending layoffs at both companies might flip the script.
Still, global content spending will reach $243 billion this year, according to data firm Ampere Analysis. This number is down from the 6% growth the industry saw in 2022 — but definitely up from the $128 billion it saw a decade ago.
In other words, streamers might be tightening their belts, but there’ll be no shortage of content anytime soon.