So I did a bit of a deep dive into this (though may have hit my head on a
few rocks). I don’t think the main take-a-way from the survey is that
streaming is overpriced (in fact, of the 8 premium streamers considered,
three are viewed as actually underpriced).
One thing to keep in mind is the survey is done by Fandom, and the
population is their members, not the US at large. I am not that familiar
with Fandom, but from what I gather it caters to kind of super and online
fans of consumer entertainment. I suspect they skew younger than the US
population as a whole
Fandom seems to think the main take away is that the most important
characteristic for streamers is “genre” – that consumers sign up for
specific programs initially, but stay because they will find additional and
consistent content in the genre that first attracted them. They argue that
churn is most likely when new subscribers don’t know what to watch next on
the service, and rather than search for new content, they unsubscribe and
maybe go elsewhere.
This seems unlikely to me, mostly because it runs counter to what we know
happened with cable TV, where narrowcasting, genre based programming
inevitably gave way to more broadbanded, less predictable programming. The
Fandom analysis will inevitably favor Disney+, which offers clear genre
based programming; if you signed up to watch Black Widow, or Encanto, or
Solo, you are very likely to find other programming on the service that you
will also be interested in. But, if you are not a child, adolescent or
young adult, this may not be very important to you. I find so far I have
probably saved money with my Disney+ subscription compared to the cost of
going to a theater to see current and archival Marvel and Star Wars films
just to be able to discuss with my young adult children.
I find the survey most helpful as an indicator of which streamers are seen
as most desirable or worthy. The average US home has about 4.5 streaming
services, but the fastest growing services are the “Free Ad-supported
Streaming TV (FAST) services (like TUBI or IMDTV, or whatever that is
called now). I could not find a good source on the average number of
premium services a US household subscribes to (and there are more than just
the big 8 discussed in this survey), but lets say that households that
subscribe to any premium service at all average 3. Kevin reports his 3 are
Paramount, Disney and Apple+. In the survey, the top three ranked streamers
clearly are: Netflix, HBO-M and Disney+. If I had to limit myself to 3 it
would probably be Netflix, HBO-M and Apple+ (I would miss Amazon the most
of the rest, but could pay a la carte for most of what I wanted). The list
below is in order of how much Fandom members thought each service was
worth, and also includes the actual cost, and the percent above or below
the estimated worth each service is. Note that the actual cost is
complicated by the offering of multiple tiers – in each case I intended to
use the cheapest ad-free option. In most cases, the with ad option is
significantly below what the survey valued the service at, which makes me
think they were not targeting FAST versions.
Worth
Worth Cost %
Netflix: 10.60 9.99 -06
HBO-M 9.30 14.99 +61
Disney+ 9.20 7.99 -13
Hulu 8.60 12.99 +51
Amazon 6.90 8.99 +30
Apple+ 6.80 4.99 -27
Paramount+ 6.80 9.99 +47
Peacock 5.50 9.99 +81
This list can also be sorted by the best and worst bargains; below I list
the three best and three worst values, defined as the percent below or
above the price the survey judged each service to be worth the actual cost
was:
Best Value
Apple+ 6.80 4.99 -27
Disney+ 9.20 7.99 -13
Netflix: 10.60 9.99 -06
Worst Value
Peacock 5.50 9.99 +81
HBO-M 9.30 14.99 +61
Hulu 8.60 12.99 +51
Two associated points, not included in the survey or Variety’s article
about it.
1.
Netflix’s stock price took a huge dive yesterday after the market closed
(at one point at least 25%), this on the heels of reporting that not only
did they fail to meet even the low end of their estimated new subscribers,
but they actually lost subscribers for the first time in years (though the
loss was due to cutting services in Russia). See:
https://www.cnn.com/2022/04/20/investing/premarket-stocks-trading/index.html
Netflix spun this in part as being due to password sharing, which kind of
pissed me off, as it seems unlikely that practice suddenly and dramatically
spiked in the first quarter of this year; this seems more like their way of
justifying coming practices to curtail password sharing. Clearly the real
reason for the dip (and Netflix is preparing investors to expect a lost of
2 million subscribers in the second quarter) is mostly due to the
increased streaming competition. Netflix may be viewed as the most
important and best valued streaming service, but it is no longer a
necessary service for many, and is now subject to the same Churn forces as
everyone else. It does seem obvious that there are more streaming services
than the market can really bare (here include what I think of as Ad-ons
like Acorn, Epix, AMC+, Brit Box, PBS, Masterpiece, etc.). I don’t expect
Netflix to go bankrupt, but I do expect over the next 2-3 years to see some
significant reduction in premium streaming services, either by merging, or
the acquisition of content libraries.
1.
As noted above, FAST services seem to be the wave of the future. In his
explanatory note to investors, Hastings announced that he has begun to
re-think his famous, long standing opposition to ads on Netflix. He did not
exactly announce an ad-supported tier, but made clear that we can expect
one over the next year or two. Peacock, justifiably rated as the least
valuable of the big 8, still reports big growth in its ad-supported tier. I
did not search for relative growth in ad-supported tiers at other
providers, but suspect the same is true there. Ad support on premium
services is not exactly a FAST service, more of a hybrid, but for a service
with an elastic demand curve, ad-supported tiers is a way to keep the cost
in a tolerable range. I am in the group that Hastings referred to as being
advertising intolerant. I despise being made to watch commercials on a
service I am already paying a monthly subscription fee to watch. I much
prefer watching TUBI or IMDTV with ads (which I do on occasion) than
watching ads on Peacock. They would have to make Netflix or HBO almost free
for me to pay them and sit through commercials. But I am older, with a
little more income, and no young children at home. I expect not only more
ad-supported tiers on premium services, but being asked to pay a higher
premium to avoid ads in the near future. On Netflix it may not be so much
that the ad tier is a discount, but a way to avoid paying future price
increases.
On Tue, 19 Apr 2022 at 7:44 PM Kevin M. <[email protected]> wrote:
> I’ve said before, I feel I’m getting my money’s worth with Paramount,
> Disney, and Apple, but there’s not much of a draw to me for Netflix,
> Amazon, HBO, or Showtime.
>
> On Tue, Apr 19, 2022 at 1:47 PM 'Bob Jersey' via TVorNotTV <
> [email protected]> wrote:
>
>> The Fandom official in charge of it told V that once people plunk down
>> the funds, they "really feel that they don’t know what’s coming. They feel
>> overwhelmed. They don’t feel that the platforms do a great job of telling
>> them.”
>>
>>
>> https://variety.com/2022/tv/news/netflix-disney-plus-hbo-max-prices-streaming-study-1235226885/
>> (link)
>>
>>
>> B
>>
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>> .
>>
> --
> Kevin M. (RPCV)
>
>
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