Streaming Is Now Sadder – New York Times

It might not be noticeable yet when we’re curled up on the couch and binge-watching Netflix, but the golden age of streaming entertainment may be coming to an end. We probably don’t like what happens next.

Soon, we may be paying more for less good options, lamenting the old days of endless streaming hassles and annoying ads.

A brief explanation of this atmospheric change: There has been a slight loss of faith in streaming’s growth potential, and the skepticism is having a profound ripple effect.

It started with Netflix and its surprising disclosure earlier this year that it had lost subscribers for the first time in a decade. On Tuesday, Netflix said it was down again, though not as much as it had predicted. Netflix CEO Reed Hastings described the company’s business results as “less bad.”

When the streaming leader began to stumble, it sparked a mass questioning of streaming services in general.

Investors in entertainment companies and corporate executives have begun to take seriously questions such as: Is streaming a worse business than cable TV? What if we overestimated how many people would pay for streaming or misjudged 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 he believed Netflix’s total potential market could be as many as 400 million users worldwide, not the one billion that Netflix has long said it would reach. If Netflix’s potential is less grand than the company imagined, or if it takes longer to get there, that’s not just a problem for Netflix. It also shows that the flow may never be as large as optimists believed.

We don’t always need to care when a wealthy company fears that it isn’t growing as big and fast as it would like. But this is different: we’ve benefited from careless streaming optimism, and the potential mismatch between entertainment companies’ expectations and reality will affect us.

Over the past decade, companies including Netflix, Disney, HBO, Comcast, Apple and Amazon have thrown money, mostly without profit, into getting customers for their streaming services. All that money has likely brought us cheaper and better streaming video services than we would have had we not had so much hope that these entertainment services had large and profitable potential audiences.

If we had fun when streaming was high, it might be scary now, when the industry is questioning its own optimism.

Netflix and other companies say they’re still confident, but they’re not. Netflix said Tuesday that after spending a long time making or buying entertainment, it will keep its programming budget roughly the same for the next few years.

Money prudence is new at Netflix, and Netflix isn’t alone. Reporters have been busy chronicling budget cuts in the streaming industry and cancellations of shows to save money. “Gone are the days of drunken sailors,” one entertainment agent recently told Lucas Shaw, a Bloomberg News reporter.

(To be fair, there’s still some drunken sailor spending, especially from companies like Apple that have goals for their streaming services other than making a profit.)

All of us will soon see the effects of this strict streaming phase, if we haven’t already. If you’re wondering why Netflix and some other streaming services release episodes of series one at a time or in batches rather than all at once for our sheer enjoyment, it’s partly a result of growth concerns. Netflix wants you to subscribe for months to watch the new season of “Stranger Things,” instead of watching every new episode over the weekend and then canceling.

Companies worried about their growth may release less “wow” programming or charge higher prices than we’re used to. Netflix is ​​launching “Paid Sharing” subscriptions, a euphemism for paying extra for people who now share one Netflix password with six cousins ​​and a pizza delivery boy. When Netflix was confident of its growth, it largely ignored account sharing. Already not.

Low-cost streaming subscriptions with ads have been popular for Hulu and HBO Max, and Netflix will try them, too. They’re an opportunity for us to pay less, but they’re also an acknowledgment that the buffet of relatively low-cost entertainment that you can watch ad-free is likely to be behind us.

It’s possible that this sadder phase is crucial for streaming. Lets see. But it’s amazing to see how much has changed since streaming companies who assumed they were growing fast for a long time had to face the fact that they were wrong.

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They are here A couple of pigeons hugging. Nothing.

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