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<span class=mb-[2px]><a href=#/posts/202209-streaming-wars/index.md class="text-lg hover:text-primary-500" rel="noopener noreferrer" target=_blank title="Edit content"><span class="relative inline-block align-text-bottom icon"><svg xmlns="http://www.w3.org/2000/svg" viewBox="0 0 512 512"><path fill="currentcolor" d="M490.3 40.4c21.9 21.87 21.9 57.33.0 79.2l-30 30.1-98-97.98 30.1-30.06C414.3-.2135 449.7-.2135 471.6 21.66L490.3 40.4zM172.4 241.7 339.7 74.34l98 97.96L270.3 339.6C264.2 345.8 256.7 350.4 248.4 353.2l-88.8 29.6C150.1 385.6 141.5 383.4 135 376.1 128.6 370.5 126.4 361 129.2 352.4l29.6-88.8C161.6 255.3 166.2 247.8 172.4 241.7v0zM192 63.1c17.7.0 32 15.23 32 32 0 18.6-14.3 32-32 32H96c-17.67.0-32 15.2-32 32V416c0 17.7 14.33 32 32 32H352c17.7.0 32-14.3 32-32V319.1c0-16.8 14.3-32 32-32s32 15.2 32 32V416c0 53-43 96-96 96H96c-53.02.0-96-43-96-96V159.1c0-53 42.98-96 96-96h96z"/></svg></span></a></span></div></div></header><section class="flex flex-col max-w-full mt-0 prose dark:prose-invert lg:flex-row"><div class="order-first px-0 lg:order-last lg:max-w-xs ltr:lg:pl-8 rtl:lg:pr-8"><div class="toc ltr:pl-5 rtl:pr-5 print:hidden lg:sticky lg:top-10"><details open class="mt-0 overflow-hidden rounded-lg ltr:-ml-5 ltr:pl-5 rtl:-mr-5 rtl:pr-5"><summary class="block py-1 text-lg font-semibold cursor-pointer bg-neutral-100 text-neutral-800 ltr:-ml-5 ltr:pl-5 rtl:-mr-5 rtl:pr-5 dark:bg-neutral-700 dark:text-neutral-100 lg:hidden">Table of Contents</summary><div class="py-2 border-dotted border-neutral-300 ltr:-ml-5 ltr:border-l ltr:pl-5 rtl:-mr-5 rtl:border-r rtl:pr-5 dark:border-neutral-600"><nav id=TableOfContents><ul><li><a href=#how-did-we-get-here>How Did We Get Here?</a></li><li><a href=#massive-investment-in-content>Massive Investment in Content</a></li><li><a href=#quality-is-decreasing>Quality is Decreasing</a></li><li><a href=#more-money-in-more-money-out>More Money In… More Money Out</a></li><li><a href=#what-happens-next>What Happens Next?</a></li></ul></nav></div></details></div></div><div class="min-w-0 min-h-0 max-w-prose"><img style="box-shadow:10px 10px 30px 2px rgba(0,0,0,.6)" src=feature.jpg><p>Last July and for the first time ever, <a target=_blank href="https://www.forbes.com/sites/carlieporterfield/2022/08/18/streaming-viewership-surpasses-cable-for-first-time-nielsen-says/?sh=76189d23767e">streaming viewership surpassed cable</a>. The streaming wars began around 2010 when Netflix introduced their first streaming-only plan with no DVD rentals, other players (cough, cough… Blockbuster) laughed at the time… little did they know. A decade after, theres a multitude of streaming services available for mainstream entertainment and also for specific niches (e.g., <a target=_blank href=https://curiositystream.com>Curiosity Stream</a> - documentaries, <a target=_blank href=https://www.crunchyroll.com/>Crunchyroll</a> - anime, etc.).</p><h2 id=how-did-we-get-here class="relative group">How Did We Get Here? <span class="absolute top-0 w-6 transition-opacity opacity-0 ltr:-left-6 rtl:-right-6 not-prose group-hover:opacity-100"><a class="group-hover:text-primary-300 dark:group-hover:text-neutral-700" style=text-decoration-line:none!important href=#how-did-we-get-here aria-label=Anchor>#</a></span></h2><p>This question could turn into its series of posts, aka a very long and boring answer. The short version, Netflix hit gold when they launched their streaming-only subscription service that allowed customers to watch what they wanted when they wanted. This was a massive shift from the linear TV experience where you either had to wait in front of the TV to watch your favorite show, record and watch it later, or wait for a rerun (<em>fun fact: there was another option to set a reminder to watch your shows :D</em>). Not only did Netflix launch a way better product to <strong>consume</strong> content, but it also changed the way users <strong>discovered</strong> new series and movies by recommending new shows based on previous history. Users flocked to this service, which was significantly better than the alternati
cannot keep ignoring that option when faced with competition.</p><p>Ultimately, this is a worse product for the user. Price increases could make the overall cost of streaming services too high for some users, which will force a choice of which services to keep. Furthermore, you will get ads again, or you can pay more if you would rather not see them.</p><h2 id=what-happens-next class="relative group">What Happens Next? <span class="absolute top-0 w-6 transition-opacity opacity-0 ltr:-left-6 rtl:-right-6 not-prose group-hover:opacity-100"><a class="group-hover:text-primary-300 dark:group-hover:text-neutral-700" style=text-decoration-line:none!important href=#what-happens-next aria-label=Anchor>#</a></span></h2><p>The high levels of competition have begun to generate frustration among users. Users are starting to get <em>fatigued</em> with the low-quality and constant recycling of content (I swear, I am uncertain whether I can handle yet another Marvel Movie or Star Wars trilogy). The increase in prices, especially in the current economic situation, will force users to choose which services to pay for, if any. And ultimately, competition for users attention has never been so high. Social networks like Twitter, Instagram, and TikTok take hours of engagement daily out of each user. Video game investment has never been so high, with so many options of games and consoles.</p><p>In my opinion, the streaming wars have already peaked, and well see a change in the upcoming years before getting to a new equilibrium. I think that one out of three things will happen:</p><ul><li><strong>Horizontal Expansion</strong> - current streaming services would need to expand to provide additional services and bundle them together. This would increase the <em>value for money</em> and could be interesting to some users depending on what is being bundled. Netflix has begun doing this with <a target=_blank href=https://www.wired.com/story/how-to-play-netflix-games/>games</a>. Companies like Amazon and Apple came into streaming exactly for this reason, expanding into streaming even if it was not their core business.</li><li><strong>Aggregation</strong> - One service to rule them all… If one of the existing services, or a new player, can aggregate content from several players at a lower price point, this could create a captivating value proposition for customers on the lower end. This option seems highly unlikely, this was Netflix play years ago, and it didnt work, potentially because they were greedy. Nevertheless, in the current scenario, it is highly unlikely that big players would share rights with another VS getting exclusivity on those.</li><li><strong>Merges and Acquisitions</strong> - Big fish eats smaller fish. This is bound to happen at some point, its just a matter of time and which company will acquire which company for what amount of money. Its not clear if this will be good or bad for customers, depending on who starts playing together.</li></ul><p>My prediction is that ultimately, big tech companies like Amazon or Apple will begin acquiring other smaller players. These companies come into streaming as a horizontal expansion from their core businesses. Both are armed with an order of magnitude more revenues than their <em>content only</em> counterparts. As an example, in 2021 Disneys revenue was $81.10 billion and Netflix&rsquo;s was $24.9 billion. In comparison, Apples revenue in the same year was $378.32 billion and Amazons was $468.82 billion. With this kind of “war chest” plus their own core business (Apple devices, and Amazon e-commerce business) it will be way easier for these companies to step in when they want to.</p></div><script>if(typeof auth!='undefined'){var oid="views_posts/202209-streaming-wars/index.md",id=oid&&oid.replaceAll("/","-"),viewed=localStorage.getItem(id);viewed||auth.signInAnonymously().then(()=>{var e=db.collection('views').doc(id);localStorage.setItem(id,!0),e.get().then(e=>{e.exists?db.collection('views').doc(id).update({views:firebase.firestore.FieldValue.increment(1)}):db.c
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