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Streaming services are starting to look like cable companies

We have often viewed streaming services as a cable salvation, but the world of streaming is beginning to take on a number of distinct cable television characteristics. How far will it go?

Why streaming services are fantastic

Streaming services have been successful because they do things differently. They are known to be inexpensive, convenient, ad-free, and contract-free. They have also changed the way we consume media and they have offered us a reliable alternative to cable companies.

Early streaming services like Netflix, Hulu, and Amazon entered the streaming market with aggressive strategies that benefited consumers. They signed as many contracts as possible with television stations and built huge libraries of successful films and television shows. Chances are you signed up for Netflix years ago, specifically Breaking Bad, The Walking Dead, or the library of Disney movies they offer.

Streaming services also gave us a new way to watch serialized TV shows. Instead of rushing home every week to catch a new episode of Bones, you can wait for it to come out on a streaming service and watch it ad-free over the weekend. Also, many of these streaming services implemented learning algorithms that encouraged you to watch shows you may have missed. Netflix's algorithms are so detailed that the website will display different thumbnails to different users depending on their preferences and the shows they have watched before.

But it turns out that the greatest force can also be a weakness. Cable cutting only works if you are trying to replicate the cable. Unfortunately, the streaming services are now trying to copy the cable themselves.

The streaming services we love are unsustainable

Years ago everything seemed to be on Netflix. The service didn't have to compete with many streaming competitors, so it managed to sign some killer deals with networks like Starz, Disney, and AMC. These deals resulted in thousands of shows and movies people were familiar with and ready to watch, such as Breaking Bad, The Walking Dead, NCIS, CSI, and Hannah Montana. These popular, contemporary shows brought many subscribers to Netflix. And it wasn't hard to keep Netflix subscribers as there was a huge library of shows and movies.

However, that changed very quickly. Competitors like Hulu and Amazon Prime began to outbid Netflix for popular shows and films. Services like HBO GO and Showtime have stopped the middleman from building their own streaming services. And some of the networks that signed contracts with Netflix early on felt cheated and tried to find better contracts once their contract with Netflix expired.

Let's put things into perspective. In 2008, Netflix signed a $ 20 million deal with Starz and won 2,500 shows and movies from the deal, including hit titles like Ratatouille and Spiderman 3. But just last month, Netflix had to buy $ 100 million for a single TV. Show, friends, get upset. You can't afford to put in as many hit shows and movies as you used to, which gives subscribers less reason to keep going.

The binge-watching format is also unsustainable. If you sign up for Netflix to watch Stranger Things, you will likely be ready to see it in a week or two. If there aren't any shows on Netflix that you feel like sticking to, you can cancel the service when you're done with stranger affairs. And if you've done all of this in your "first free month", Netflix won't get a penny.

Hit shows bring people to streaming services, but they don't necessarily keep people around. In the past, a hit show that aired weekly on a television station gave people a reason to renew their subscription every year and provided the networks with a steady stream of income. However, streaming services cannot expect this from their shows.

Streaming services are becoming TV channels

Netflix and the other streaming services can't afford to compete for well-known shows anymore, and they certainly can't afford to bring in contemporary, popular titles like they used to. A show like "Friends" continues to subscribe to die-hard Friends fans, but Netflix cannot capitalize on the hype of another "Breaking Bad" or "Walking Dead".

Unless they create the hype themselves. In recent years, Netflix has slowly moved away from network TV shows in favor of Netflix Originals. Shows like Stranger Things, Cleaning Up With Marie Kondo, and House of Cards have earned Netflix a lot of subscribers and don't cost nearly as much as a Friends renewal. It's got to a point where the only really good shows on Netflix are Netflix Originals. This process is also slowly happening with services like Amazon Prime and Hulu, and companies like Apple plan to create their own platforms for streaming content in the future.

This is a great thing for streaming companies because it ensures that their competition doesn't steal all of their main content. But this format is very familiar to the format of cable television shows. Each channel has exclusive content, with the occasional crossover. And if these network TV shows deviate from traditional streaming services, where are they going?

Well, TV stations are building their own streaming services on top of them. Some of them, like Starz or Adult Swim, are only available through an add-on from your cable provider. Others, however, are following the HBO GO trail, offering their shows and films exclusively for around $ 15 a month. Disney, WarnerMedia, DC and NBC plan to set up their own streaming services in 2019. In many cases, you will not find their properties on other platforms.

Nothing wrong with the original content, but the early strong point of services like Netflix and Hulu was their diverse, affordable library, which was haunted by a number of television shows on the network. If this trend towards exclusive content continues (and will), you will need to subscribe to many different services in order to watch shows from different networks. In essence, it will feel like streaming services are a new iteration of television channels.

Streaming services also mimic cable bundles

Cable bundles have always been the curse of human existence. People hate being overcharged for a package of channels when they just want access to a single TV show or channel. And if the two or three shows you want to see are in separate packages, you end up spending a ridiculous amount of money, mostly on content you don't want.

Why are bundles of cables full of shows nobody wants to know? Because that's the point. Cable companies are pooling popular channels with unpopular channels to keep everything afloat. No one in their right mind would want to pay for the Home Shopping Network, but it can make a profit, so it ends up in a bundle with the NFL or Cartoon Network.

The bundle format keeps the cable alive. It's not good for consumers, but it does guarantee that TV stations will receive a steady stream of income even when pushing junk content.

Streaming services work similarly, but in a quieter mode. Netflix, Hulu, and Amazon are poised to shell hundreds of millions of dollars on shows like The Office, Seinfeld, and Friends because these are shows die-hard fans will watch over and over again for years.

If every fan of The Office or Friends becomes a subscriber to Netflix, Netflix is ​​guaranteed a stable stream of income that can support the other titles, much like bundles of cables mixing popular and unpopular channels to keep everything alive.

Yes, big hits like Stranger Things bring in a lot of subscribers. The hits are few, however, and binge watchers can opt out when they're done with a trending show. Since Netflix has failed to produce its own classic comedy show that brings people in the same way Friends do, the company has no choice but to spend $ 100 million on a contract extension. Upcoming streaming services like NBC also rely on the quiet bundle format to keep the roof over their heads. You'll likely only subscribe to one or two NBC streaming services for a show or two. However, if those shows are The Office or Parks and Rec then chances are you could keep that subscription for an extended period of time.

While the bundle format supports streaming services to stay alive, it can get frustrating and expensive for consumers. Netflix increases its subscription rate every year, presumably because they spend so much money on their hundreds of million dollar contracts. Some services like Hulu with Live TV and Amazon Prime are following suit, and there is no telling how high the prices will get. And as more streaming services emerge, good content becomes more exclusive. You could end up subscribing to a handful of streaming services just because each of them has a single show that you want to watch.

Live TV streaming is essentially just cable

One of the main reasons people stick to cable is because of the news and sports channels. There are a variety of live TV and sports services online and these are usually much more expensive than the average streaming service. The basic plans for Hulu Live and Fubo are $ 45, but you'll have to pay a bit more if you want access to more channels. Sling starts at $ 25, but there are also add-on packages.

Add-ons? Pay extra for more channels? That seems familiar to me. And why not? Live TV streaming services are operated by cable companies. Sling is owned by Dish Network, Disney will be the major shareholder in Hulu in a few months, and I'll bet you can't guess who owns DirectTV Now.

Some live streaming services aren't just cable clones. Twitch is one of them. But the television news and sports industries are totally committed to the format of the cable. You grew up next to cable television. If news or sports were shown on a service like Twitch, they would have to completely reorganize their format. They'd have to advertise differently, they'd have to keep their audience from switching tabs, and they'd have to be responsible for a global audience without time zones. And when people subscribe to an online version of cable, news and sports networks have no reason to change their format.

With these live TV services, consumers are already losers. People leave their cable company to subscribe to an online version of their cable company. They are currently being charged less, but live TV streaming services are already getting more expensive.

Not to mention on-demand streaming services, if you continue to fragment into expensive small websites, it may be cheaper to subscribe to a live TV streaming service that shows content from a variety of networks.

Why is this happening?

Streaming services are starting to look like this is an undeniable fact for cable companies. They employ practices that are similar to bundles, and they fragment themselves into channel-related services that offer their exclusive content for $ 15 a month. Some streaming services are operated or bought by the same companies that run the cable companies, and most live TV services online are just a wolf in sheep's clothing.

This doesn't happen because streaming services compete with cable television. Streaming is the future. This happens because streaming services and television stations compete with one another within a decentralized, unsustainable business model. You have to bid for shows that could at some point be taken out of service by a competitor. You have to offer a lot of good content to be successful. They don't have contracts or weekly shows so subscribers can leave at any time.

This competition pushes streaming services, focus on exclusive content and turn on-demand streaming into a new iteration of television channels. And since on-demand streaming services haven't found a way to receive live news and sports, cable companies are diving headlong into the live TV streaming market. They are preventing the live TV format from changing the evolution of serialized television and they laugh at the walk to the bank because their customers think they have finally escaped the cable.

Streaming services are still fantastic

Streaming has many advantages, and those advantages are not going away anytime soon. You can now save a lot of time and money by cutting the cable. Even the live TV options are cheaper than cable (at the moment). You can also share the cost of your subscriptions with friends or family and unsubscribe at any time. As Justin Pot pointed out, streaming services are just better than cable - and they still are.

People who don't watch a lot of movies can do the occasional rental on Amazon or Youtube and some websites offer ad-supported on-demand streaming (AVOD), e.g. B. Lifetime, Roku Channel, Youtube, Plex and finally IMBD Freedive. Streaming services also allow users to watch old shows or movies that have been removed from syndication. Niche services like Mubi and the Criterion Channel let you watch expensive, hard-to-find movies, and services like Qwest.tv are dedicated to concerts and music videos.

And of course, streaming services have completely changed the way we create and consume media. Finding a movie or TV show is easier than ever, and serialized TV shows are turning into binge-watching masterpieces. Netflix, Amazon, and Hulu originals have made a huge impact on our lives and culture, and the quality of these original shows and movies is sure to increase as competition increases.

But we should be wary of streaming services. They offered us a rescue from the cable, but a few missteps could bring us back to point one. It's easy to ignore a $ 2 increase in your bill and subscribe to a service that you don't use. If you don't want where a streaming service is going, take your money elsewhere. This is the only way you can communicate with a company.

Sources: Medium / Netflix, Digitaltrends, Forbes, New York Times, Macworld