The cry of the early 21st century has been “unplug from cable!” With the rise of streaming media, paying for hundreds of channels with nothing on was deemed a waste of money and time. Instead, the average consumer has turned to streaming media subscriptions to fill his home entertainment needs. It’s no wonder, with the average price of cable now north of $200 a month. The rise of streaming services allows customers to choose where to spend their money, voting with dollars for services that provide the best entertainment ROI. That, in turn, has led to many media companies jumping on the streaming bandwagon. Is it all too much?
In a David Geithner Medium article, he notes that most American consumers now pay for four separate streaming services. That’s averaging out to about $47 a month per household, still a far cry from the $200 for hundreds of unwatched cable channels. No one is surprised that Netflix is still the most subscribed to service, with over 209 million users. It’s closely followed by Amazon Prime, although since it comes with the Prime delivery membership, it’s not clear how much the service is based on its video offerings. Disney+ quickly leapt into third with its full catalog of Disney features plus all of its Marvel and Star Wars IP. HBO Max rounds out the top four with or 67 million subscribers who tune in for its award-winning independent programs along with its back catalog of classics from the Criterion Collection.
The top four players are offering extensive, high-quality catalogs for a quarter of the price of a cable subscription, but more services are elbowing in on the action. Hulu and Apple+ are producing highly-rated independent content that vies for the same viewers. Hulu has also entered agreements with channels like FX to provide current cable content without the cable bill.
On top of the up-and-comers, many media groups like NBCUniversal, Discovery and Warner began streaming services during the pandemic, taking advantage of the increase in subscriptions, viewers and hours spent watching while people were stuck at home. Reese Witherspoon recently sold her media company Hello Sunshine for $900 million, with the buyer, Blackstone Group, hoping to transform her women-centric business model into a new streaming platform. She’s not the only one. Ron Howard and LeBron James are a couple of other big names behind potential streaming platforms.
The world has opened back up and people are returning to work and play outside the home, which begs the question, will there be a market for all the new streaming services? At some point, consumers will reach the point where they are paying as much for streaming as they did for cable, or they will simply give up on trying new channels. The key for new players is to find their niche market, creating add-ons with high production value that complement the big players instead of trying to replace them.
While viewership may go down post-pandemic, with the higher quality programming and continually competitive pricing, the streaming marketplace hasn’t yet hit the ceiling.