We're about to witness a bloodbath in the streaming space. YouTube and Snapchat have already announced they are deprioritizing original content in their product strategies. Newer players like Peacock are losing close to half a billion dollars per quarter on their nascent services. Consumers have room for maybe 2-3 subscriptions in their budget and yet we have eight or nine fighting for our wallets. It's a totally unsustainable sector right now.
So the question inevitably becomes: which of the services will survive the stream-pocalypse?
If you break down all the different players in streaming, you can put each of them into one of two buckets: those who prioritize quantity, and those who prioritize quality. The poster child for Team Quantity is Netflix, who has a rightfully earned reputation for throwing a bunch of original content ideas at the wall, seeing what sticks, and cancelling the rest after one season. Shows like Stranger Things and The Crown prove that Netflix is fully capable of making a show-stopping original series, but their content strategy always seemed to be centered on creating a lot of okay content, not a little bit of great content, and their hit rate is definitely below that of some competitors. As a result, I think people have a more casual relationship with Netflix than they might HBO. Netflix seems like more of a background activity or mind-massaging break than a fully locked-in, committed experience for a lot of people. I would put a service like Discovery+ into Team Quantity too. Its content isn't generally designed to drive deep, lasting engagement; it's more so designed to answer the question, "What would it be like to live naked in the jungle for three weeks with only one other person who happens to also be naked?"
The other side of this coin is Team Quality, and you can imagine what the difference is. As I've written before and as I think is a generally accepted statement, no player in original content has a better hit rate historically than HBO. Their ability to churn out gripping, unique storytelling so efficiently and consistently led them to become one of (if not the) most respected brands in television. Their library isn't as big as Netflix's, but if you had to randomly select a show from either library to watch in full, you'd much rather pick from HBO's library than Netflix's. In this same vein, I think Apple TV+ is sneakily becoming the heir to the HBO throne. Severance is perhaps the most thrilling show I've seen in my life, CODA became the first streaming-led movie to win Best Picture at the Oscars, and little praise can be given to Ted Lasso at this point that hasn't already been written by thousands of others on the internet. Apple seems to have developed this same keen eye for quality.
So which is going to win? Team Quality, or Team Quantity?
I think Team Quality wins this one all the way. In fact, I'm not sure any Team Quantity companies will survive this next round of consolidation. That's not to say Netflix won't be able to pivot to Team Quality and survive, but the quantity-led strategy of mindless content will not succeed in a post-TikTok world. People my age who are just looking to casually watch something entertaining aren't turning to Netflix anymore; they're turning to TikTok. TikTok has filled that void of low-effort entertainment that Netflix once owned, and I don't see that tide changing anytime soon. And let's not overlook the influence YouTube has in this niche as well. Where TikTok specializes in a very specific brand of blind scrolling, YouTube caters content ranging anywhere from quick laughs to hours-long video essays, and nearly everyone already uses it. These two platforms run entirely off user-generated content, and Netflix will never be able to compete with these economics. In essence, Netflix is losing its relevance as background entertainment to two players who Netflix will never be able to financially compete with. And I think Discovery will soon realize that too.
But I don't see TikTok or YouTube ever being able to offer content that has the high production value, emotional capacity, and quality filter of good scripted television. This is a niche they have consciously decided not to pursue (and why would they when they can keep raking in profits using their $0 content budget). I think the only players that will survive long-term in the streaming space are the ones who put their entire focus into this "quality-first" mindset rather than trying to fight with TikTok and YouTube for your mindless attention.
If I was Netflix, I would put all my energy into creating one new Stranger Things, not ten new Emily in Paris.
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