Streaming Wars Taking No Casualties

Thus far, Disney+ and HBO Max are additive rather than cannibalizing competing services.

WSJ (“Forget the Streaming Wars—Pandemic-Stricken 2020 Lifted Netflix and Others“):

The past 12 months were billed as the year when a flood of new entrants would force streaming services to wage an all-out war for subscribers. Instead, incumbents and rookies alike feasted on a base of shut-in customers eager for more things to watch.

The largest streaming services are expected to finish 2020 with combined U.S. subscriber numbers more than 50% higher than a year ago, according to a Wall Street Journal analysis of data from market-research firms MoffettNathanson LLC and HarrisX.

They enjoyed a captive audience. The coronavirus pandemic triggered lockdowns that sent millions of Americans home, leaving many people with more time to watch movies and shows from the couch. The virus also prompted movie theaters to shut down and sports leagues to go on hiatus for months, further boosting streaming services’ appeal.

“Instead of a streaming war, there’s been streaming coexistence and parallel growth,” said Dritan Nesho, HarrisX’s chief executive. New services such as Walt Disney Co.’s Disney+ grew rapidly without necessarily harming established players such as Netflix Inc. NFLX -1.18% and Hulu, he said.

“Disney+ did not displace existing services,” Mr. Nesho said. “It complemented them.”

Disney+ is one of many streaming platforms that didn’t exist a little over a year ago. It launched in November 2019, a few days after Apple Inc.’s Apple TV+. Two other major players, AT&T Inc.’s HBO Max and Comcast Corp.’s Peacock, went live in recent months.

About a year ago, Americans told a WSJ-Harris Poll survey that they were willing to subscribe to an average of 3.6 streaming services—and some 30% of the Netflix subscribers among them had said they would likely cancel their subscriptions to make way for new services.

In fact, the new streaming platforms didn’t prevent Netflix and others from continuing to sign up new customers at a healthy clip. Their growth came as traditional pay-TV providers continued to lose subscribers. Satellite and cable companies have shed more than 1 million pay-TV customers each quarter since mid-2018, a trend that analysts expect to continue.

U.S. households now subscribe to 3.1 streaming services on average—up from 2.7 last year, according to Kagan, a media research group within S&P Global Market Intelligence. About three out of four U.S. households subscribe to at least one streaming service, MoffettNathanson data show.

Here’s the accompanying graphic:

As noted recently, we subscribe to more than the average number of steaming video services: Hulu, Netflix, Disney+, Amazon Prime, and HBO Max (and that doesn’t include NFL Sunday Ticket and YouTube Premium and Amazon Music). But we’re an affluent household with seven people, including five students ranging from 9 to 21.

I honestly don’t understand how more normal households can justify that many subscriptions. There just isn’t enough time in the day to watch that much content and very little of it must be seen in real time.

Aside from the pandemic creating a captive audience, I suspect a lot of it is just inertia. Most of the services are just a few bucks a month and canceling and restarting is maybe just more trouble than it’s worth. And three or four subscriptions is still way cheaper than a cable bill.

FILED UNDER: Economics and Business, Entertainment, Popular Culture
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. Sleeping Dog says:

    I honestly don’t understand how more normal households can justify that many subscriptions. There just isn’t enough time in the day to watch that much content and very little of it must be seen in real time.

    Fear of being out of the loop around the water cooler. With the most talked about shows being spread over multiple streaming services, if it is important to your self image to be (popular) culture literate, you need to watch them and that means multiple subscriptions. In a way, the pricey cable bundles that included HBO, Showtime etc were an example of the same effect.

    It’s interesting to compare the differences between music streaming services and video. Few people subscribe to multiple music services because the creative talent is independent of the service and in fact can exert control over the service, see Taylor Swift. One of the reasons pod casts have become such a field of acquisition by the the large streaming services is that the service has an opportunity to control the talent.

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  2. Paine says:

    Yeah, the economics of streaming services can be quirky. Given that the monthly bill for any single one is only $7-$12 a month it’s really not too painful to sign up for another one. Likewise, cutting a service I don’t use as much is hardly going to have a noticeable impact on my wallet.

    And even if I do end up paying roughly what I was paying for a subscription I value the different viewing mentality that streaming services offer. Back when I had a cable package I would spend hours on end lying on my couch watching MSNBC and flipping though channels during the commercials. But now, I’m quite deliberate about what I watch. I sit down to watch a specific movie or show and when I’m done I move on to the next thing I need to do. Cable TV was just a huge time sink.

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  3. Some comparative numbers that might be interesting:

    1. BluRay sales.
    2. Cable and Satellite subscriptions.

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  4. wr says:

    I subscribe to an appalling number of streamers — Netflix, Amazon, Hulu, Disney+, Criterion, CBS All Access, Apple +, HBO Max, youTube premium — but I do it because as a TV writer and teacher of TV writing and one in the middle of writing another book on writing for TV I need to see as much of the new stuff as I can. And at least they’re all deductible for me. Even so, I don’t have a fraction of the time it would take to keep up to date on it all.

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  5. Kathy says:

    You know, during this long weekend, I’ll rent or buy “All The President’s Men.”

    Back on topic, I subscribe to one service at a time. I tell myself, and others, that I’m not cheap, but I hate wasteful spending. So, given I work 11 hour days when we’re not busy at work, I mostly watch TV on weekends. So why keep several services going, when I won’t be able to watch more than I can find in one?

    Sometimes when I’m streaming a series, I will watch one ep or two on weekdays. I did that with Star Wars Resistance (too short), and last year with The Good Place.

    So, for now, it’s Disney+ until the end of January because it’s already paid up that far. After that, if Netflix has the full 3rd season of Discovery, I’ll switch there.

  6. inhumans99 says:

    Honestly, this big-time TV enthusiast (I am a homebody, and have been a bit anti-social my entire life so even pre-covid I was big on spending the day in front of the tv) would need to ask for streaming subscriptions as gifts from the family if some were not “free.”

    Of course, I am paying for HBO Max and Peacock by way of spending a lot on my xfinity triple play package which gets me a nice fast internet connection, a landline which I still want to keep, and a cable package that give me most of the premium channels without having to pay for them a la carte. I still consider HBO Max and Peacock free because the reality is that they are not a line item charge on my monthly bill (or if they are the amount is at $0.00).

    I get Hulu for “free” as I have been with Sprint for many years and they offered Hulu w/ads for free several years back.

    Apple TV+ was made free to the masses during the pandemic, and if this service is no longer free once the pandemic winds down I will happily pass on it.

    I do straight up pay for Netflix’s HD/4K streaming package but otherwise, I am able to tap into a staggering variety of content across the streamers for less than one might think. So many people have packages with xfinity or their local provider that I bet a lot less people are paying for things like HBO Max or Peacock a la carte.

  7. Crusty Dem says:

    @Sleeping Dog: well, if you ditch satellite/cable you can pretty much pay for every streaming service you can find and still have cash leftover..

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  8. Mister Bluster says:

    @Kathy:..All The President’s Men
    Look for a young Lindsay Crouse. Per IMDb this is her film debut.

  9. Sleeping Dog says:

    @Crusty Dem:

    I have no idea, we have basic cable and my wife watches a few shows regularly and the local news. Me? I haven’t watched a ‘TV show’ of any type since we cancelled Netflix several years ago. I’ll watch sporting events occasionally, but that’s about it. The local library has hundreds of DVDs of movies that we’ve never seen, so we may watch one each week during the winter. The fact that many are decades old doesn’t bother us. I can also go down the YouTube rabbit hole from time to time. Currently watching a guy restore a Series Land Rover.

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  10. Mister Bluster says:

    @wr:..I need to see as much of the new stuff as I can.

    One of the first traumatic, life changing decisions I confronted occurred in October of 1955 when I was all of 7 years old. I had been watching Howdy Doody and Buffalo Bob and Clarabell every weekday as far back as I could remember. The show debuted in December of 1947 about a week before I was born so I thought of myself as a charter member of the Peanut Gallery.
    One day the Big Kid down the block told me about a new TV show called the Mickey Mouse Club and how it was so much better than Howdy Doody and I needed to check it out. This is the same big kid who told me that there was no Santa Claus which turned out to be true so I had to follow up on his advice.
    The problem was that both shows were on at the same time!
    I remember being torn as I had been so loyal to Howdy and Princess Summer, Fall, Winter, Spring and the gang. How could I abandon my friends?
    Well. You guessed it.
    After watching the Mousketeers, especially Sharon, I wanted Mickey Mouse ears and I got them from my parents my next birthday.
    Howdy Doody was so 1954. I never looked back.
    I often wonder what my life would have been like if home VCRs existed back then. Would I have taped one show and watched the other?
    I’ll never know.

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  11. Kathy says:

    @Mister Bluster:

    Didn’t you switch channels during commercials?

    BTW, the phrase above will be meaningless very soon.

  12. Dave Schuler says:

    No casualties? Pay TV is basically falling off a cliff. That has revenue implications not just for the cable companies but for state and local governments.

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  13. Michael Reynolds says:

    @wr:
    Ditto.

    It’s not a question of, ‘how much TV do you need?’ It’s more, for me at least, a question of, ‘why can’t I watch whatever I want?’

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  14. Just nutha ignint cracker says:

    I honestly don’t understand how more normal households can justify that many subscriptions. There just isn’t enough time in the day to watch that much content and very little of it must be seen in real time.

    I think that it’s possible that the oversubscription is a version of conspicuous consumption for the less than uber-riche, although FOMO plays a role in driving the justifications for doing it. Lots of people feel the need to keep up with whatever Joneses they perceive themselves as being in competition with.

    When I was the age of your youngest daughters, my parents wouldn’t have even thought of subscribing to television stations specifically because I or my brother wanted to watch them. Now get off my lawn, you hoodlums!!! 😉

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  15. Michael Reynolds says:

    Here’s something that would be helpful. For reasons I cannot fathom sites like Rotten Tomatoes et al insist on telling me who produced a show while refusing to tell me where I can actually watch it.

  16. Kathy says:

    @Michael Reynolds:

    Well, in some cases it might be hard to keep up, and that’s not their business model (if any). Also, where a show can be streamed varies between countries. In the US you get all the new Trek shows in the CBS service. In Mexico Discovery is on Netflix, and Picard on Amazon.

    But there are sites like justwatch.com. They are not 100% accurate all the time, but they get close.

  17. Mister Bluster says:

    @Kathy:..switch channels during commercials

    D’oh!
    Well I’m sure I could have. I was sitting on the living room floor right in front of the TV so all I had to do was give the dial a twist. There were only two channels in Rochester NY at the time.

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  18. Sleeping Dog says:

    @Mister Bluster:

    When I was a kid there were 3 network + public TV in Boston and if you had an antenna that rotated, you could pick up the one network station in NH, plus the NH public TV station. You could barely get a Maine station, but it was worth watching for the weather report from the top of Mt Washington in the winter. 30 below ambient, 120 mph winds and they hadn’t seen the sun in a month.

  19. James Joyner says:

    @Kathy:

    Didn’t you switch channels during commercials?

    I don’t know what the state of play was in 1955 but, by the mid-1970s, the networks seemed to be in collusion to time their commercials simultaneously. One could flip the channel to a sporting event that was on its own timetable to catch a few plays.

    I’m surprised, however, that he didn’t catch Howdy Doody in reruns. That’s how we watched competing shows in the old days.

  20. James Joyner says:

    @Dave Schuler:

    No casualties? Pay TV is basically falling off a cliff.

    Oh, absolutely. I’m part of that trend. But I consider the “streaming wars” to be the competition among the various services as the studios have realized allowing Netflix to carry all of their shows was a mistake and “cord-cutting” to be a separate phenomenon, albeit one enabled by the ability to stream live TV and a near-infinite variety of movies and older shows.

  21. James Joyner says:

    @Michael Reynolds:

    while refusing to tell me where I can actually watch it.

    There are sites that attempt to do that but it’s damn near impossible to keep up. I saw something late last evening waiting around for the ball to drop about all the shows cycling off and on Netflix alone this month. Even just skimming for shows I cared about, it was exhausting. Try doing that for, what, a dozen services?

  22. Kathy says:

    @James Joyner:

    I don’t know what the state of play was in 1955 but, by the mid-1970s, the networks seemed to be in collusion to time their commercials simultaneously.

    I don’t think it was collusion, but rather that shows and commercials had a standard structure across TV networks.