It’s not quite as noticeable when we flop on the couch and flip on Netflix, but the golden age of streaming entertainment may be coming to an end. We might not like what happens next.
Soon we’ll be paying more for less good options, feeling anxious about the old days of unlimited streaming Bing, and sitting through annoying commercials.
A brief explanation for this vibe shift: There’s been little loss of confidence in the growth potential of streaming, and skepticism has lingered.
It started with Netflix and its surprising revelation earlier this year that it lost subscribers for the first time in a decade. On Tuesday, Netflix said it has shrunk again, though not as much as it had anticipated. Netflix co-chief executive Reed Hastings described the company’s business results as “less poor.”
When the streaming leader started stumbling, it triggered massive inquiries about streaming services in general.
Investors and corporate owners of entertainment companies began to take questions like this seriously: Is streaming a worse business than cable TV? What if we predicted how many people would pay for streaming or miscalculated how quickly they would change their habits?
Streaming remains the future of entertainment, but, as I’ve written before, the future doesn’t necessarily come in a straight line.
One investment analyst told my colleague Nicole Sperling that she believes the total potential market for Netflix could be 400 million subscribers worldwide, rather than the one billion that Netflix has long said it will reach. Had been. If Netflix’s potential is less grand than the company imagined, or if it takes longer to get there, it’s not only a problem for Netflix. It also suggests that streaming may never be as big as the optimists believed.
We don’t always have to care when a wealthy company thinks it’s not growing as big and fast as it wanted. But this is different: We’ve benefited from unrelenting streaming optimism, and we’ll be struck by the potential mismatch of entertainment companies’ expectations and reality.
Over the past decade, companies including Netflix, Disney, HBO, Comcast, Apple and Amazon have been throwing money, mostly for no profit, to grab customers for their streaming services. All that money has brought us some of the cheapest and better streaming video services than, if not so expected, that these entertainment services had a huge and lucrative potential audience.
If there was more hope about streaming than we enjoyed, it may be a depressing thing now that the industry is questioning its own optimism.
Netflix and other companies say they are still confident, but they are not acting that way. Netflix said on Tuesday that after spending more money on creating or buying entertainment for a long time, it will keep its programming budget roughly the same for the next few years.
Vivek is getting a new look at Netflix with money, and Netflix isn’t alone. Reporters have been busy cutting budgets and canceling shows around the streaming industry to save money. “The days of drunken-sailor spending are gone,” an entertainment agent recently told Bloomberg News reporter Lucas Shaw.
(In fairness, there is still drunken-sailor spending, especially from companies like Apple, which have goals for their streaming services other than making a profit.)
If we haven’t already, we’ll all soon be starting to see the effects of this rapid-ish streaming phase. If you’ve wondered why Netflix and some other streaming services are releasing episodes of the series all at once or in batches for our binge-watching enjoyment, it’s partly the result of development concerns. Netflix wants you to subscribe for months to watch a new season of “Stranger Things” instead of watching all the new episodes over the weekend and then canceling.
Companies concerned about their development may release less “Wow” programming or charge a higher price than we’re used to. Netflix is starting to roll out “paid sharing” subscriptions, a euphemism for charging extra for those who now share a Netflix password with six cousins and a pizza delivery guy. While Netflix was confident about its growth, it mostly ignored account sharing. not anymore.
Low-cost streaming subscriptions with commercials have been popular for Hulu and HBO Max, and Netflix will be trying them out, too. They’re an option for us to pay less, but they also recognize that a relatively low-cost, full buffet of no-ads entertainment is most likely to be behind us.
It’s possible that this sad phase is a blip for streaming. we will see. But it’s shocking to see how much has already changed since streaming companies, assuming they would continue to grow exponentially long, faced the possibility that they were wrong.
Before we leave …
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How to keep your gadgets cool when it’s hot: Frozen peas, good. Hot car in July, bad. Read more hot weather advice about smartphones from The Washington Post. (A subscription may be required.)
are here smuggling a pair of pigeons, You are welcome.