Illustration by Jude Strzemp
A CRISIS OF STREAMING
By Lauren Cavalieri
CNET, a website dedicated to product reviews for consumers, ran an op-ed on Aug. 7, 2015. It was titled: “Resistance is Futile: Streaming TV is the future — now.” Caitlin Petrakovitz, the article’s author, rejoiced in streaming’s convenience. It was a kind she could only imagine as a child, back when she had to memorize the air times of “Sesame Street” and “Star Trek: The Next Generation.” She loved TV back then. Streaming made her love it more.
She wrote, “Everything you could want to watch is so readily available.” Streaming is a dream come true for Petrakovitz, writing “Fifty years ago, watching TV on public transportation felt like a sci-fi dream; now, I watch sci-fi on the train every day. And that’s progress, baby.”
Petrakovitz’s excitement, the glorious utopia she anticipated, makes sense. Film and TV are two of Western culture’s most valued forms of storytelling. Yet, historically, access to these mediums has been limited. Films were only viewable in a theater, where they’d play for a few months before archival or destruction. TV episodes aired at a specific time — missing them meant waiting years for the reruns. This lack of access would be squashed by videotape, which proliferated in the 1980s and gave people the power to watch what they wanted, when they wanted. In the 2000s, the internet suggested another revolution in media access, actualized in the form of Netflix.
Netflix became the great equalizer, offering thousands of movies and shows under one digital roof, all instantly available, for a small monthly fee. It was unprecedented. Netflix became an unparalleled force in the entertainment industry. Those that tried to imitate their reign failed. But about a decade later, Hollywood studios charged the streaming world with powerhouses like Hulu and, especially, Disney+, before Netflix’s Godzilla-sized jaws ate them alive. Where does that leave streaming? Embroiled in war.
Once it was a revolutionary medium. Now it is a nuisance: a laundry list of expensive services, ever-changing libraries and deleted content. As a result, subscription numbers are plummeting. Streaming companies are scrambling to steady declining profits.
“The world of streaming can be highly frustrating,” says Chuck Barney, a former TV critic for the Bay Area News Group. “Not only are the number of services — and shows — overwhelming, it’s often difficult to understand where and why certain content is located.”
Yet as ugly as streaming looks now, it could get uglier.
When the Coronavirus shut down the globe in 2020, many people were stuck at home with little to do but binge-watch. Companies took full advantage, understanding they’d need to make their services seem irresistible in this crucial time. Their digital platforms became life rafts for movies that planned to debut in theaters. Once theaters began to open back up, Warner Bros. decided to premiere their 2021 slate of movies on HBO Max and in theaters at the same time. Disney made a similar move with “Black Widow.” Its star, Scarlett Johansson, filed a lawsuit against Disney for allegedly cutting her out of her share of box office profits. The suit also claimed ”the decision to (release “Black Widow” in theaters and on Disney+ the same day) was made at least in part because Disney saw the opportunity to promote its flagship subscription service.” Sure enough, Disney+ and other services saw their subscriber numbers explode.
Streamers celebrated lofty earnings and eagerly invested them back into content. Disney began releasing a continuous stream of Marvel and Star Wars shows, bringing in huge audiences due to these franchises’ past success. Disney+ soon began to rival Netflix in subscriber count. Then, in March 2022, the Apple TV+ movie “CODA” made history as the first streaming film to win an Oscar for Best Picture. There was seemingly no limit to the heights streaming could reach, no slowing of the mountainous growth.
But a problem was brewing. The volume of streaming content overwhelmed subscribers. A 2022 study by Nielsen Data found over the last three years, unique programming has increased by 20%. They claimed 46% of viewers felt overwhelmed by the overall number of services. This customer frustration was snowballing, rapidly.
A month after “CODA’s” big win, that snow ball plundered downhill. In April of 2022, Netflix announced it lost more subscribers in one fiscal quarter than it gained, which hadn’t happened since 2011. Disney declared a net loss of $1.47 billion in its streaming division, over its third quarter. CNBC noted that NBCUniversal, owner of Peacock, received an ominous note from a Bank of America investor in October 2022 that read, “we worry that Peacock may struggle to hit engagement figures of 10 hours a month.” Engagement is industry-speak for watch time, and 10 hours a month is really, really low. When asked about this note in an interview, NBCUniversal CEO Jeff Shell quickly changed the subject.
As per usual, the consumer eventually paid the price.
The concept of on-demand video streaming was introduced by Netflix, founded in 1997 by Reed Hastings and Marc Randolph. Blockbuster was the biggest name in home entertainment then. They were notorious for charging customers late fees. Hastings, per CNBC, wound up paying $40 after returning a copy of “Apollo 13” past the due date, and the idea for Netflix was born. Randolph, though, via The Washington Post, said this was “convenient fiction.” The real spark, he said, was when the two decided to create “the Amazon.com of something” (Amazon was only selling books at the time). Whatever the case, the two decided to build a website where they’d sell DVDs in bright red envelopes.
The lure was irresistible. No late fees. DVDs were brand new tech, and sleeker than Blockbuster’s VHS tapes. Best of all, the movies were delivered. No more trips to a brick and mortar. No more lines.
Eventually, Netflix would take convenience to another level. Utilizing the streaming technology made famous by YouTube, they created a service where people could stream shows and movies instantly for a monthly fee of $5.99. Launching in 2007, it came a just the right time.
Cable TV was getting unruly, especially as bundles forced customers into buying hundreds of channels they’d never watch.
Ditching cable seemed a no-brainer, which led to the “cord-cutting” trend. Hundreds of Blockbusters closed throughout the late 2000s and, in 2010, the video giant filed for bankruptcy. Streaming was the future. Established entertainment companies soon realized they’d have to adapt.
Despite their debut on cable, old shows like “the Office” and “Friends” thrived on Netflix. Even though creator companies profited from licensing, they disliked sharing. Barney argued this was what fueled them to make their own services. “The feeling was, ‘Why should Netflix be benefiting from our content? We should be controlling our own content.’”
Early attempts to take on Netflix were largely a saga of failures. Remember YouTube Red? YouTube hoped it would
turn its biggest creators into movie stars, which backfired when many of them got into scandals, notably Logan Paul, whose mockery of a dead body led to his resignation from YouTube completely. In 2018, the service dissolved. NBC invented Seeso, a comedy-focused platform, in 2016 but it lasted just two years. Perhaps Netflix’s most successful competitor was Hulu, which was available to the public in 2008. Yet, it’s always lagged in subscribers and original content.
The pioneering legacy of Netflix gave it a special place in online culture. Shows like “Orange Is The New Black” and “House of Cards” raised the standard for quality TV. They became an essential part of modern dating through the infamous phrase “Netflix and Chill.” Following its debut in 2016, the success of “Stranger Things” was stratospheric.
Disney would finally become the first competitor to make Netflix really sweat. On Aug. 4, 2017, Netflix released “Icarus” (their first feature-length film to win an Oscar). Four days later, Disney announced it would pull all of its content from Netflix and launch its own streaming service. They would call it Disney+, and it would host a century’s worth of iconic movies and shows for its fiercely loyal consumer base. Its launch in November 2019 shook the industry. Meanwhile, WarnerMedia was preparing to launch HBO Max, NBCUniversal was gearing up to release Peacock, and Discovery was setting Discovery+ for liftoff.
The streaming war was on for real. Just a few months later, a bomb was dropped that would raise the stakes tenfold.
While the pandemic was devastating for most industries, streaming flourished. “We weren’t going to restaurants. We weren’t going to movie theaters, or to see plays or concerts. So our time spent with streaming services was bound to increase,” Barney explained. As the pandemic raged, streaming also provided comfort. “(It) was a welcome alternative to all the grim news we were seeing on television.”
The Coronavirus gave new streaming companies the opportunity to get aggressive with self-promotion. Suddenly, customers were getting stretched thin by a seemingly endless number of services that all demanded loyalty.
There’s an issue I noticed one night in September 2022 when my brother and his friends were looking for something to watch together. They went to Netflix and couldn’t find anything, so they headed to Prime Video, then to HBO Max then to Hulu. Useless exertion before finally deciding they’d watch YouTube.
This problem is called fragmentation.
In 2020, the average American subscriber, according to the accounting firm Deloitte, has four streaming subscriptions, a result of content being stratified across a large number of services. These platforms are experts at convincing users to stay subscribed.
“People don’t want to miss out on the new seasons,” said Brody Price a freshman and computer science major at Las Positas.
Another student, Rachel Dayton: “There’s been times where I’ve been like, ‘Dang, I should really delete HBO.’ But my boyfriend’s watching ‘House of The Dragon’ right now and I don’t want to wait.“
Adding to customer stress is the scheme of expiring content. America’s favorite shows are becoming like milk with a “Best By” date. Per the site What’s On Netflix, more than 90 titles left Netflix in the U.S. on Nov. 1, 2022. This might sound like a lot, but this is a standard monthly rotation for Netflix. Streaming platforms rotate their licensed content to ensure subscribers are always satiated.
Jenna Heke, a San Ramon resident who considers herself a TV lover, takes issue with this. She uses Emby, a media server that downloads and stores her content from many services.
“(It’s) kind of like how you would have a library of all your DVDs,” said Heke, who pays for the service’s monthly subscription. “I can go to Emby and it’s all there.”
The service can save treasured shows from being completely erased, at least on a small scale. August 2022, HBO Max culled 20 original shows as part of Warner Bros.’ plan to save $3 billion, before merging with Discovery. According to streaming analyst Julia Alexander, deleting shows helped avoid “residuals to casts and crews of a production,” residuals being monthly payments after a title has been released.
Some of the shows, such as “Infinity Train,” are available to rent on iTunes and Amazon. Others, like “Aquaman: King of Atlantis,” are plain gone. And along with them, that ol’ unlimited options, kid-in-a-candy-store feeling Perkowitz raved about.
Barney suggests this could become a trend, as studios realize it’s not financially viable to preserve content. “I think we will see a lot more culling,” he said. “...We’ve been accustomed to thinking shows and movies will permanently reside on these platforms. I think we’ll steadily adapt when we realize this isn’t always the case.”
However, the TV business already tried this. It ended up backfiring.
Before the 70s, TV networks practiced “junking,” which involved erasing and reusing tape recordings to save money. BBC did this with Doctor Who, vaporizing more than a hundred episodes, 97 of which are still missing. Fans are disappointed. Even now, there are online forums dedicated to finding the lost episodes.
When the HBO Max purge happened, many subscribers took to social media to rant, so much so that Zaslav’s name trended on Twitter’s home page. Their anger was reminiscent of the kind “Doctor Who” fans likely felt decades ago. Fans enjoy the ability to watch and rewatch. There’s security in knowing content will always be available.
As it has turned out, streaming isn’t the holy grail of entertainment it once seemed. Corporate power has seemingly reduced streaming to a labyrinth of exclusive and temporary content, locked behind growing paywalls.
At once democratizing how people watched, it now features financial barriers that create different levels of access. Helmed for how easy it was to navigate, it’s now difficult to keep up with the shifting libraries. And perhaps most jarring: movies and TV are no longer mediums that exist perpetually in the present. Now they are ephemeral, temporary forms, trashable unless they meet the right engagement metrics.
It was a sci-fi dream 50 years ago to watch a show on a train. Nowadays, it’s an everyday thing. What audiences from both periods have in common, and from every period in between, is being sabotaged in the name of corporate interest. People believed they’d finally reached the point of unlimited opportunity, but that fantasy has come and gone. But pendulums swing hard, and maybe one day these companies will realize how much they’ve alienated customers. How much money they’ve lost. How much trust they have crushed. And all for what? Winning the content war.
“I think you’ll see some services wither and die, simply because the landscape is so overwhelming and oversaturated,” Barney said. "That’s not to say streaming itself is going anywhere. It will evolve and morph in various ways. But overall, streaming isn’t going to disappear.”