The Streaming TV Sector Still Doesn't Realize Exclusives Will Drive Users Back To Piracy
from the unintended-consequences dept
So we've noted a few times now that the rise of streaming video competitors is indisputably a good thing. Numerous new streaming alternatives have driven competition to an antiquated cable TV sector that has long been plagued by apathy, high rates, and comically-bad customer service. That's long overdue and a positive thing overall, as streaming customer satisfaction scores suggest.
But as the sector matures, there's a looming problem it seems oblivious to.
Increasingly, companies are pulling their content off central repositories like Hulu and Netflix, and making them exclusive to their own streaming platforms, forcing consumers to subscribe to more and more streaming services if they want to get all the content they're looking for. AT&T, for example, will soon make all of its owned content, like Friends, exclusive to its looming new streaming platform. Disney, similarly, has been pulling its content off of Netflix and Hulu to ensure it's exclusive to its own, looming Disney+ streaming service that arrives next year.
This week, Comcast noted that it would soon be pulling The Office from Netflix, making it exclusive to its own streaming service in 2021:
We're sad that NBC has decided to take The Office back for its own streaming platform — but members can binge watch the show to their hearts' content ad-free on Netflix until January 2021
— Netflix US (@netflix) June 25, 2019
By itself that's not a big deal. You can go buy the entire DVD box set of the Office for $50 on Amazon. But cumulatively, over the next few years, the sector risks creating so many exclusive silos that it begins to frustrate and annoy customers forced to shell out $8-$15 per month for 20 different services. Studies suggest that nearly every broadcaster will launch their own streaming service by 2022. And they all want their content exclusive to their own platform:
"Want to watch the new Star Trek? You’ll need to pay $6 a month for CBS All Access. Want to watch Game Of Thrones? That’s $15 per month for HBO. Stranger Things? That’s $9 to $16 for Netflix. The Office? $15 to Comcast. Fleabag? Another $9 to Amazon, please. The Handmaid’s Tale? $6 to Hulu; $12 if you don’t want ads."
The result, as one Deloitte study called it, is "subscription fatigue." Again, superficially, folks could argue that this isn't a big deal because consumers can hunt and peck, mixing and matching different subscriptions and cancelling and signing up to new ones to build their perfect package. But if you ever tried to cancel AOL during its heyday, or say, tried to cancel a Wall Street Journal digital subscription online, it should be obvious that as markets mature companies make it a pain in the ass to actually cancel and change services. There's really no reason to think this won't happen in streaming as the competition heats up, they've nabbed their desired market share, and the focus shifts to retaining existing customers.
And here's where net neutrality and telecom merger mania comes in. If you're AT&T Time Warner or Comcast NBC Universal, you've got significant advantages in this race. One, you own both the conduit these services have to travel over, and you own much of the content competitors need to compete with you. And as we've already seen, these companies aren't shy about exploiting this advantage. AT&T, for example, only imposes usage caps on its broadband customers if they use a competitor's service. But if you use AT&T's streaming services, those arbitrary and unnecessary surcharges mysteriously disappear. Similarly AT&T offers discounts (like HBO for free or just $5) if you use AT&T's wireless services.
When you're getting telecom discounts tied to subscribing to AT&T (or Comcast's, or Verizon's) streaming service, which service do you think you're going to cancel first? And with the death of net neutrality, limited broadband competition, and folks like Ajit Pai being a mindless rubber stamp to industry, who exactly do you think will stop incumbent ISPs from exploiting this advantage anti-competitively? Again, there might be competition in streaming, but if there's no competition in broadband, and there's rampant regulatory capture, you're probably gonna have some market headaches.
Ultimately, history has shown repeatedly that when consumers can't get the content they want easily, cheaply, and quickly, they'll resort to piracy.
So The Office is leaving Netflix in 2021 to go to an NBC streaming service.... pic.twitter.com/TdVgxfvsgk
— Jamie (@Jamie_2455) June 26, 2019
Admitting this fact isn't condoning the behavior, it's just stating a fact. There's some early anecdotal evidence this is already happening, with BitTorrent usage seeing a notable uptick in recent years as it has gotten more and more cumbersome for users to identify which service holds the rights to the content they're looking for. In this case the telecom sector still wins, because the arbitrary and technically unnecessary usage caps and overage fees still net them money. You'll either subscribe to an ISP's own streaming services, or you'll get penalized for piracy or using a competitor. Comcast and AT&T win either way.
Again, none of this is to say that the rise of streaming competition is a bad thing. Just that there's going to be some growing pains over the next 5 years. Growing pains that the industry isn't particularly keyed into because they're all mindlessly running head down to the trough. And those that do realize that the rise of exclusivity will lead to piracy probably figure they'll cross that bridge when they come to it. And when they do get to that bridge and piracy rates soar, history suggests they'll probably try to blame everything but their own behavior for it.
Ultimately, it seems likely that in 5-10 years, even after the weaker options have been shaken out via competition, consumers will still desire some kind of central subscription repository that makes navigating all of these choices and finding content easy. Whoever controls that repository will control the kingdom. And with the pieces on the chess board as they are now, it's pretty damn likely that telecom could cheat their way to the throne. And should telecom be left in charge of what the future of TV looks like, you're likely going to find that future looks (and is priced) a lot like the cable TV options we fought so hard to innovate away from in the first place.
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Filed Under: exclusives, piracy, silos, streaming tv
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Remember when everyone used to clamor for a la carte television, where you just pay for the channels you'd actually want to watch?
Congratulations. You've now got it. Did you honestly not expect the industry to royally screw that up?
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Re:
Not quite the same. This version would be like driving to Burger King for the burger, then to McDonalds for Fries, then to Wendys for a Frosty.
We want a single supplier/account wherein we can choose the channels in a given accurately priced package. I want SyFy, BBC, and whoever has Captain Slow's Worldwide Adventures with the Hamster and the Orangutan. she wants her channels. I'm not putting up with a dozen channels all with the same 10 over the top/under the bottom taxation schemes.
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Re: Re:
This is more like driving to McDonald's for a Big Mac and Burger King for a Quarter Pounder and Wendy's for whatever they call their burger. If you really need to have a specific type of burger (and several of them at once), then yeah you have to hit them all.
But Netflix, Amazon and all the rest have - or will have - the equivalent of hamburgers, fries, shakes, etc. In fact they all have several in each category. Netflix does this now: here's the cop show row, here's the British murder mystery row, here's the row of stuff for teen girls.
if you just want a good prestige drama or a good cop show or a good supernatural thriller and don't much care about the specifics of whether the pickles are sweet or sour and what the secret sauce tastes like, then you can stick with whatever McDonald's or Netflix is offering and ignore the similar offerings at Amazon/Burger King.
Channels like SyFy or BBC won't matter much in the future (don't matter to me now) because streaming services can make everything those channels do. Netflix in fact is doing an end run around the BBC and going direct to the people who make BBC content. That's how they created The Crown and Our Planet - those are made by people who used to make stuff for the BBC but Netflix is paying them more, so...
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I'm sure you told us all long ago how this would unfold and we all simply ignored your prediction that has now come to pass, it's all our fault that you need to suffer because of our stupidity.
/s
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I still pay significantly less for TB than I did back in the day when I had a Sky subscription (UK), and I feel like I'm getting better value for money. The bonus is that my subscription is also not being used to fund content I don't care for.
This could certainly be improved, but it's much better than it used to be, for me at least.
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There is a world of difference between selecting and paying for ta selection of wanted channels channels from all the channels some supplier offers, and paying a lot of different suppliers for their bundles of channels or series of programs,.
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"Congratulations. You've now got it. Did you honestly not expect the industry to royally screw that up?"
I believe most of us, even way back twenty years ago when we first started getting really whiny about it, had every expectation that the industry would indeed try - and screw up in spectacular ways.
The copyright cult relies on monopoly precisely because none of them would be able to run a business to save their lives.
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"They MADE me commit crimes!"
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I know I'm in the minority, but after making the leap from cable to streaming only a few years ago I've drastically cut down on the amount of TV programming I actually watch. At this point I'm perfectly happy watching what's on Netflix, Amazon Prime and YouTube, and any show that pulls from those three sources pretty much ceases to exist in my "want to watch" library.
Like I said, I feel like I'm a rarity in that I don't actually watch much TV, but I'll still be shocked if these "exclusive" walled gardens are even close to as populated as the studios anticipate.
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Damien I am sure i spend much less time watching TV/Movies since I cut the cord. I have several streaming services now, and I don't use them as much as I did.
One thing I never do anymore is just surf, looking for "something" and end up watching a movie I like "Because it was on" commercials and all, instead of getting up and finding the shelf with the disk. :)
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I find that I'm now more likely to do other things, then sit down to watch the specific thing I want to watch. Whereas before streaming, I would either flip through to see what was on even if I had nothing in mind, or I'd just watch whatever was on before or after what I was tuning in for. Since I generally know what's available on the streaming services I subscribe to before I bring them up, there's far less time when I'm not watching, other than the occasional browse when bored.
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I don't think you're that much of an outlier. I, too, watch significantly less TV now than when I had cable. It may be that I'm spending less time flipping through channels looking for something to watch. Maybe I'm also missing a lot of shows I didn't know I'd want to watch. But these days I'm content to watch whatever looks interesting on Hulu, Netflix or Amazon and totally disinterested in everything offered by everyone else. Well, except for Game of Thrones which I've been using HBO's trial accounts to binge once the season has ended.
We don't pirate anything but I expect that's because there's nothing I'd care to watch enough to bother. We used to watch pirated GoT streams but the quality was so poor and it took a while to find a stream that was even watchable. I'm just not that interested in watching anything to mess with all that.
Since cutting the cord 10 years ago we've found lots of other more interesting things to do than camp on a couch on our asses for hours.
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I've tried many streaming services, only to cancel them because I don't watch them at all. The lack of scheduled programming has taught me most of TV is not really interesting and if I don't have to watch something "when it's on," I never have to watch it.
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Re: Watching less TV, a recommendation
I also watch less TV. I've found a free, superior alternative: The Internet Archive.
IA has videos, including older TV (less vulgar, coarse and low, much less sex & violence). Further, I've found that playing an audio book in the evening is every bit as enjoyable as any latter day TV program, and there are no commercials. (Hit PAUSE, for kitchen or bathroom breaks). Librivox is pretty good for many audio programs. The audio books can be saved for later playing or creating one's own library.
TV has a place, for current weather radar and local forecast. The emotional and intellectual price of other TV content is quite high. IMHO, too high for either anyone who is or aspires to be truly civilized, or is a little sensitive.
If those who aspire to be nothing more than the rabble, and want the schlock of TV as the TV industry wants to sell it, let them pay for it. Let them pay for it the hard way, if that is the only way they will learn.
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Personally I just refuse to reward companies for doing this. I have Netflix and Hulu, and that's all I will ever pay for.
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The Downside to Discovery's Success
Looks like everyone thinks they can repeat CBS's success with Star Trek: Discovery. Unfortunately, it will likely be a short bandwagon.
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Re: The Downside to Discovery's Success
Example: DC Universe
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Re: Re: The Downside to Discovery's Success
You beat me to that - exactly what I was going to say. Talk about limited content!
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Re: Re: Re: The Downside to Discovery's Success
Very limited and not the best. I have seen the Teen Titans and I wasn't a fan. I haven't heard good things about the other series they are offering.
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Re: Re: The Downside to Discovery's Success
Young Justice was the most-watched streaming series at the time it debuted.
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something something competing online music services....
that ended poorly for them, why do they think it will work this time?
I mean its not like CBS released 'The Good Fight' from its streaming exclusive to on air... oh wait... they plug you can stream all 3 seasons now...
Lets make it as complicated as we can for consumers b/c the big guys won't give us what we want... I mean they have all of this backend & tech but our content means we shoudl get 99% of the profits.
How about giving up on the whole we'll all have out own streaming services, and focus on getting clearances so you can make sure more content customers want to pay for for is available. Maybe work out the bullshit so you don't have to replace music & screw with peoples memories.
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"something something competing online music services....
that ended poorly for them, why do they think it will work this time?"
What ended poorly exactly? There's plenty of choice, both free and paid, most services don't depend on exclusivity for the most part and it's generally possible to listen to what you want either directly or through random playlists.
If what music services are right now is to be the standard for video streaming, I wouldn't actually have much of a problem with that. They could be better, but apart from one or two bands who are still refusing to be on the services I use, there's not much of a problem.
"Maybe work out the bullshit so you don't have to replace music & screw with peoples memories."
That's a totally different issue to the one you started discussing.
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Re:
Each of them believes that their content will be worth paying for and viewers will flock to them with money in hand. That may be true for some small portion of viewers but those same viewers aren't also going to sign up for half a dozen other services at the same time.
I don't think we're going to see "subscription fatigue". We're going to see 5 or fewer of these services succeed and the rest will shut down, signing on with one of the survivors to air their content. When their puppies and rainbows predictions of subscription riches don't pan out they will have to accept reality. The result will once again be fewer sources of more aggregated content.
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Re: Re:
This is correct, with one caveat: the losers won't be "signing on" with the winners, they will be bought up by the winners, or at least their good brands will be. For example, CBS is probably too small and too limited to make it. Apple needs big brands and they have plenty of money to throw around. Apple buys CBS, maybe leaves the broadcast portion behind like Disney left broadcast Fox behind, and just keeps the good stuff - namely big brand names like Star Trek and Twilight Zone. Apple can hire people to make content under these brands so they don't even need production capability, Just the brands will do.
Really when you get right down to it, what corporations will battle over is exclusive rights to big brand names. For everything else, they can hire the tech and creative people to create the platforms and churn out content - but if you don't have the legal rights to Star Trek, Star Wars, etc, you can't slap that brand on whatever you make and reap the huge rewards regardless of whether the crap you are making actually deserves it.
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please stop trying to put sense where there's no fucking room!!
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1 show per service
The way things are going, your going to end up with each show being it's own $3.99 / mo service, with episodes released once per week.
When shows are no longer popular then the Hulu's of the world will get them. This is like the dream of most studios so they can double dip on exclusive content and then farm out to syndication.
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Re: 1 show per service
And on various pirate sites, within seconds as a stream, and after one play through as a download.
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Re: 1 show per service
Amazon is already kind of like this. There is a lot of aged content, often missing seasons in the middle of the series, that is included with Amazon Prime. But other content is PPV. I'll probably cancel AP again soon as there's not much to watch and the "free shipping" is also a joke (seriously, compare the prices of items with "free shipping" to those of the same items where shipping is not free. All you get for your subscription fee is 1 day faster shipping.)
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Re: 1 show per service
Know what? I'd actually be fine with that... If you substituted "within a predictable limited time" for "when no longer popular" and made sure all the "Hulu's of the world" get the same deal on the old stuff.
Me, I'm prepared to wait a bit, but hey, a lot of people aren't so maybe there is a market for "exclusive silos" for all the new, shiny stuff for 6 months, maybe a year or so, as long as eventually it ends up a bit like music mechanical licenses that anyone can pick up and show older content so the "Hulu's of the world" can all compete on price and service instead of grubbing round after unrealistic rates for content not everyone wants to watch...
Just a thought...
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Re: Re: 1 show per service
And.. yes I know, I've clearly been smoking too many unicorns and rainbows. Chances of happening the real world.... sigh
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PC gaming is heading down the same path with Xbox Game Pass, Origin Access, and the upcoming Uplay+. You can expect other "AAA" publishers (Bethesda and Activision/Blizzard in particular) and even distribution platforms (read: Epic's store) to jump on that bandwagon.
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The larger streaming services, apple music , spotify etc basically have the same
music .
Tv Streaming service,s all want their own exclusives to attract customers .
If you want to watch certain programs on disney or nbc you,ll
to pay for their streaming services,
maybe people will pay for netflix and one or 2 services ,but
no one will pay for 5 or more services .
Theres no way all these new services will be viable in the long run.
And some companys like comcast will zero rate their streaming services .
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Think I'll read a book.
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Re:
I have over 100k ebooks to choose from thanks to bit torrent sites.
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Re: Re:
I prefer something they can not simply take away.
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Re: Re: Re:
Which brings us to another top reason why people infringe, also mentioned lots here;
naughty download = no pointless DRM = the stuff can't be "simply taken away"
Thus, ironically, infringing content is actually more valuable than paid-for content.
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Re: Re: Re:
Strip out the DRM(or simply only buy non-DRM infected books), load to an eReader that isn't connected to the internet so once something's on there it's on there to stay unless you remove it...
While ebooks do open up the possibility for them to be 'taken back' due to seller/publisher shenanigans there are ways to work around or even avoid the problem and still use them.
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Being the exclusive source for content is fine, but what they need to do is to let people pay for just the content that they want without having to pay for a subscription to every service.
If I want to buy a DVD, I can just go to Amazon and buy it. Or Walmart, or eBay, or wherever. I don't need to pay a monthly fee for the privilege of paying for what I want. Users should just be able to go to HULU or Netflix or any other service and just pay for one show.
They should also be able to actually buy a copy, which can be downloaded, saved and played without limitations. It worked for music, but the movie studios and TV networks are too scared to try the same thing for video. There's a show on Amazon that I would buy if I could actually BUY it. But no, I have to have a subscription to Amazon and then the best I can do is to buy a perpetual license to stream it any time I want until such time as I cancel my subscription or Amazon removes it. No thank you!
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And Hollywood loves this, guaran-damn-teed.
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The perfect solution
I have a great idea, literally the perfect solution to this problem.
We create a company that works out contracts with each of these exclusive streaming companies. Then we offer bulk "packages" of content from different companies, and give a single rate! So you pay one bill for content from all of the companies, and you get it all, whether you want it or not! We offer different tiers, and a few premium options. We could even create our own devices required for access, not allow it to work on 3rd party devices, and charge "rent" on that device to make even more money. Why has no one thought of this before!
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They fix the piracy problem easily...
...by making all their exclusive content unwatchable shit.
Game of Thrones' popularity was thanks to piracy. The majority of its viewers pirated the content. (Though in some cases, piracy includes going to a friend's house where they have HBO.)
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Simple math
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I honestly can't bring myself to care all that much. At the end of this expansion of streaming services is going to be a contraction as ones that can't keep up wind up closing shop. What was once a bunch of streaming services will become a smaller and more manageable handful.
I'm enjoying all of the exclusive shows and what-not that are being produced and funded by these streaming services. As a fan of animation, it's been wonderful seeing the medium finally finding a place away from risk-averse TV network execs who cancel promising series at the drop of a hat.
Alongside this, people need to remember that what he have right now is better than what we ever imagined. We can pause and pick up shows at any time across myriad devices. Ads in most cases are either non-existent or limited. Subscriptions are easier to manage than dealing with the cable company and it's dozens of channel bundles, and usually cheaper too. What we have right now is damn good, and people need to take a step back and remind themselves of that fact.
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It's unlikely I'll pirate anything--because I just don't care that much about ever seeing anything in particular, but I'll also never subscribe to any streaming service offered by a single entity (Disney, Time Warner, NBC Universal, etc.) as opposed to a Netflix (not a subscriber at present) or Amazon.
On the other hand I'll keep waiting for "the video store" to return--a local place where I can go and browse and rent discs for viewing... like in the old days (good times... good times).
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And yet Techdirt is implicitly supporting Epic's PC exclusives as somehow being good for the industry, despite the outcome being exactly the same thing...? (That is, driving PC gamers back to piracy.)
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Re:
Game companies have the advantage of having a history that doesn't completely comprise them of being complete douchebags when it comes to piracy or copyright infringement.
Although sometimes, it's definitely hard to tell between the two...
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How Many?
I recall a discussion on the radio's Business Report here in Canada when Crave was trying to edge out Netflix. As one commentator said to the other "How many different streaming services are you going to pay for at $10 a month?" The other laughs and says "One?"
This is what I find too. If it's not on Netflix, and I don't bother downloading it, I don't watch it. Other than sports and my wife's soap opera, we hardly watch anything live - except when for filler, our TV is tuned to CNN. Even regular TV events (Amazing Race, Law & Order) we PVR and may be several episodes behind when we get to them. There's far too many things to watch already. If it isn't on Netflix - we don't get around to watching it. Sometimes we download - just watched Handmaid's Tale downloaded. I don't think I'd pay whoever it was $10 a month for several months for the privilege of watching that, even though its horrifically fascinating.
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Yeah, That's Called USENET
"Ultimately, it seems likely that in 5-10 years, even after the weaker options have been shaken out via competition, consumers will still desire some kind of central subscription repository that makes navigating all of these choices and finding content easy. "
USENET is an amazing example of something not being talked about at all because they can't do anything about it. With the right software, USENET is all the things consumers want. I know. I'm enjoying it.
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Re: Yeah, That's Called USENET
What most people do not realize is USENET (slightly modified) is also the solution to big centralized social media sites ...
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The streaming "sector" is oblivious to this problem because the "sector" has no mind, no will and no budget or mandate to do anything. The entities that do possess these things are called corporations. Collectively they may make up the streaming sector but they act individually and their motivations and money are put towards their individual good.
Nobody cares about the collective good of the sector. They are all engaged in an existential struggle to kill off competitors and emerge as one of the 4 or 5 corporations that survive in the end to dominate global streaming. I can take a guess at what those names will be, but nobody is just going to meekly accept their fate is to lose and be gobbled up by a bigger, stronger fish. They just have to fight it out.
In the end, these global streaming behemoths will have mutually exclusive libraries composed of only content they own. Any independent content producers that remain after consolidation will have to enter into exclusive contacts with the behemoths if they want their content seen at all.
Consumers may want one central repository of content - convenient and reasonably priced - but that will never happen. Imagine what happens to that reasonable price when the competitors consolidate down to one. Zoom! To the moon.
But that will never happen either. Let's say Disney gobbles up Netflix, Amazon, AT&T, Apple, Comcast, CBS and Taco Bell for good measure. Then they try to jack up the price. All that does is open a market for a reasonably priced competitor to start churning out attractive content, and we're right back where we started.
As nature takes its course, the number of behemoths that the sector will settle on will be low, but not one. Based on paying customers opting for 2-3 services per household, a lot of overlap in what they like, and easy churn, 4 seems like the number in the end. 5 if we assume some competitors like Apple are just being stubborn enough to stick it out.
Piracy doesn't much factor into this. The winners and how many there are, will be determined by paying customers. But if piracy encourages people to subscribe to a couple and then just pirate what they can't get there, it will accelerate the consolidation that is going to happen anyway by placing an even bigger premium on bigness, big brands, and just being there first - the values that will determine the winners in the end.
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crappy interfaces
isnt there some uber nerd that can come up with a better interface other than down and over
down and over
down and over
I am wearing out the arrows on my remote!!
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