Clash of the TV titans

Creative Industries | Growth | International | Latest News | Leisure & Tourism | Lifestyle | Technology

tv streaming

The results are in for Netflix’s first quarter of 2019: the media subscription service has gained another 9.6m customers, taking the total to 148.9m. This beats the forecasts, but the announcement was tempered by predictions of slower growth in April and June due to price rises. Netflix is increasing subscription prices across the US, Brazil, Mexico, and some parts of Europe in order to meet the costs of creating original content.

Commenting on the Q1 figures, George Salmon, Equity Analyst at Hargreaves Lansdown, said: “This is the latest in a series of outstanding quarters, but some will worry that with competitors slow on the uptake, Netflix has enjoyed an artificially easy ride so far.

“That won’t be the case for long. Apple and Disney have announced plans for content streaming services to much fanfare, and Amazon is getting ever more established. With a combined market cap of around $2.2trn, those three bruisers aren’t to be messed with.”

Apple announced AppleTV+ in March, with Disney following suit last week with Disney+. Both firms have a distinct advantage over Netflix: Apple has a huge pre-existing fanbase with Apple hardware in their homes, while Disney has a formidable back catalogue of content. It is likely that as contracts expire, Disney will pull its properties like Marvel, Star Wars, and of course Disney films, off competitor streaming platforms.

George Salmon noted: “Rather than briefing investors on a strategy to cope with the competition, Netflix CEO Reed Hastings is actually rather relaxed. With streaming still only accounting for 10% of American TV time, we can see why. Only time will tell if there will be room for everyone at the table, or if the market evolves such that the US streaming giants start to clash elbows sooner than expected.”

Why the mad scramble to claim a slice of the TV pie? With Game of Thrones mania set to dominate social media and staff room conversations for the next six weeks, it’s not difficult to sense the scale of the current and potential TV industry. AT&T bought Game of Thrones for $85bn in 2018, and the Game of Thrones franchise worth a further estimated $1bn. It may be expensive to make blockbuster TV – HBO reportedly spent $15m per episode for season eight – but huge fanbases mean huge business. And Game of Thrones nets almost 30 million US-based viewers alone.

This may be the future of entertainment: blockbuster series with deep producer pockets, available from an affiliated subscription streaming platform. Higher quality entertainment with a higher price tag to match, and consumers cherry-picking their streaming platforms to suit their personal tastes. Perhaps we’ll see more niche branding of platforms, like the marketing of BritBox to international audiences, as streaming providers try to establish a fanbase.

The television industry is not facing unique challenges and opportunities. The music industry has already pivoted to subscription services, along with podcasts and audiobooks. As consumers, we increasingly curate our own content, and entertainment providers must adapt to the push for personalisation.

Related News:

Did you enjoy reading this content?  To get more great content like this subscribe to our magazine

Reader's Comments

Comments related to the current article

Leave a comment

Your email address will not be published. Required fields are marked *