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OPINION: There have been a few interesting developments in the video streaming space, so let’s try and see if we can break them down.
First off, it’s very clear that video streaming isn’t going away. This past week saw the launch of Tubi (tubby, to-bee?) in the UK after it launched in the US years ago.
It’s a streaming platform from Fox Corp, and like Pluto TV (owned by Paramount), Samsung TV Plus and the Roku TV Channel, it’s a FAST (Fast Ad-Supported Streaming Television) that is free to watch with a library that’s bigger than even Netflix can muster at over 20,000 movies and TV episodes.
I’ll just repeat that it is free to watch all that programming.
That follows on from Netflix’s announcement that it’s getting rid of its cheapest ad-free plan, meaning subscribers will either have the choice of paying less and receiving ads or paying more to avoid them.
Netflix has gone down this route because its ad-plan has been so successful since it launched (40% of all sign ups are at this tier), even though it means that we’ve just pivoted back to what linear broadcast TV was, except we’re streaming it online instead of getting it through our aerials.
Adverts are the future (again)
What’s interesting here is the way the video streaming climate is moving towards ads and free plans. People want to save money and these plans offer the means to do so. It also means that the market has started to get saturated with all these options.
A few weeks ago there was an event – a summit even – where video streaming and its future was discussed in depth by the major players in the industry.
Every Hollywood studio wants its own streaming app but not everyone needs it, especially with there being so many options to choose from in terms of ad-free and ad-based services.
Tubi
During the pandemic, streaming was viewed as something of a silver bullet for Hollywood studios to recoup losses from cinemas being closed. The problem with streaming services is that they eat up a lot of capital – Disney made losses up of to $3bn with Disney+, Paramount has experienced significant losses with Paramount+, and Warner Brothers. Discovery has had an up-and-down few years (mostly the latter), with its cost-cutting measures giving the studio a bad reputation among creatives.
At that summit, it seemed as if Warner Bros. Discovery was laying the groundwork to bring the Max app to the UK once its agreement with Sky finishes at the end of 2025. And I can’t help but think that’s a bad move.
Max in the UK?
It’s clear that with Netflix and Disney+’s ad-based plans, along with the entrance of Tubi, as well as the growing emergence of Samsung TV Plus and LG Channels, the market has charged. Subscribers don’t seem to care where the content comes from anymore, just that they can keep their bills relatively low.
So another paid streaming app entering the discussion seems like one (or a few) too many. It hasn’t really worked out for Lionsgate+, and in the case of Paramount+ and Peacock (Universal), both of which have cosied up with Sky in the UK to give them more prominence. Others have had to do eye-catching promotions to get people onboard, but subscriber churn has been high and doesn’t look as if it’ll be decreasing any time soon.
Warner Bros. does have one of the best Hollywood libraries in its pocket, with classics from every decade including part of MGM’s library (The Wizard of Oz, for example). It has its DC Comics line-up, and franchises like Lord of the Rings, The Matrix, Lethal Weapon, Harry Potter, Mad Max and more. That’s not forgetting all its HBO programming either, which set the gold standard for TV for decades with watercooler shows like Game of Thrones, The Sopranos, and more.
Image Credit (Trusted Reviews)
But despite that treasure chest, the video streaming market doesn’t appear to need more entrants or competition. There’s already enough choice and margins don’t appear to be massive or healthy enough for several to compete against one another. I’ve heard some talk about bundling services together to stop churn, but customers have been conditioned to affordable prices and you know that bundles won’t be cheap.
Streaming services such as Tubi look like they’re the future – they recently edged Disney+ in the US for total viewing time, and that shows the direction the streaming winds are going in. As the streaming market has developed, it’s shown there’s only room for a few and if a service like Max enters the UK market, it could struggle to make an impact.
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