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The Streaming Revolution Will Be Televised


Streaming services have taken the world by storm. While one of them generally gets touted as the frontrunner and game-changer, which it clearly is, we're talking about the streaming revolution in a more general sense.

Once upon a time people regularly bought movies and movie tickets... you may have even been one of them, "needlessly" forking out money for discs that would eventually become coasters and movie stubs that could easily deplete your monthly entertainment budget depending on just how big you like to make movie night. The disruptors have come, left their mark, reconfigured consumer habits and much has changed.

Now almost everything gets compared to your streaming service subscription fee. It happens in a direct sense. For instance, you might hear "why would I buy physical copies of films when I can get an unlimited supply from my streaming service?". It also happens indirectly. "I pay less to stream movies than it costs to have my car washed!".

the streaming revolution will be televised

You may recognise this comparative-speak from marketing copy... some still like to use cappuccinos as if they were a currency. You've seen it somewhere. "For the price of a cappuccino you can get phone screen insurance" etc. It's become so universal that it could very well become the new estimate of value as if you were comparing the price of Coke cans to get an estimate of perceived currency value across several countries.

The services do tend to mold to their markets, so this wouldn't be as useful as a Coke can unit of measure but its so commonplace that the matrix would serve up some interesting findings. The bottom line is that streaming services are offering their entertainment content at ridiculously low prices. So low that you wonder how they can afford to pay to license content and create their own at a sustainable level.

The answer of course is volume. Having a few million subscribers means that even if you were charging a few dollars per month, that would be multiplied into the stratosphere. Wielding that kind of income is a game-changer, allowing a typically digital entity to grow progressively... much more easily than a traditional bricks and mortar set up.

The Internet has opened up a number of amazing opportunities and the power of sporadic growth is one of them. Not only are software and systems able to do much of what was usually reserved for actual human beings (imagine that!), they work relentlessly and are tailored to stretch with an influx.

You'll still need people to answer the phones and be accountable for the corporate pageantry of mergers and major signings, but these Internet "startups" are making it possible to make money out of thin air. Keeping everything in the digital ether makes business sense. Why pay for a building to house your multitude of employees when you can just have them work remotely, virtually... from anywhere on the planet with an Internet connection.

This thinking has led to many major disruptors taking over... because how do you compete with something that isn't there? It's like shadow-boxing or taking on your imaginary friend. This is how you start a revolution. It's also a way to throttle the competition by running at a near-loss, changing consumer habits and resetting appetities whilst growing your empire. Yet, somehow, other streaming services are rising up to challenge Netflix. Many others. Each believing that they'll be able to capture enough market share to justify their own reinvention of the wheel and sustain them through recycled entertainment and fresh "content".

One of the biggest problems with redefining the entertainment horizon is that when consumers start comparing everything to the value of a Netflix subscription, it means they ultimately buy less and have unrealistic expectations of other services. It undermines everything from optical media, video rental and exhibition... making it seem like daylight robbery to charge anything more than a month of Netflix subscription.

Another problem is that once you've set the bar so low, you'll struggle to raise it. The boil-a-frog strategy comes to mind in this case, where streaming services will have to raise the price of their subscription slowly enough to ensure the frog doesn't jump out of the water.

Now with a host of other streaming services that haven't withered and died, it may become a case of the nomadic subscriber where one subscription is put on ice to focus on another channel's entertainment offering until the other one freshens its slate again. Seeing that Netflix is raising its subscription price in South Africa where many luxury spends are already on the line... we could see a shift to other cheaper services or a return to more of a pay-as-you-go spending profile.

Many streaming service adopters have pretty much thrown in the towel when it comes to physical media, wondering why they have a DVD or Blu-ray player and shelves of discs clogging up their minimalist entertainment set up. However, the optical disc market has become so inundated with "coasters" that their intrinsic value may see a comeback like LPs.

Compare buying 10-20 of your favourite movies with the cost of a month's Netflix subscription and the balance may start to tilt again. Even if you don't like the idea of storing the movies, at such low prices there's nothing stopping you from selling them, passing them on or literally turning them into coasters.