Panic stations: why streaming’s set for big changes in 2024
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Streaming services are heading for a major shake-up in 2024, according to The Financial Times. While Netflix is making money, most other streamers aren’t – and with losses of more than 5 billion dollars in the last year alone, Netflix’s rivals are looking at cost-cutting, consolidation and maybe even exiting the streaming market altogether.
According to the FT, which has spoken to multiple industry analysts and insiders, entertainment conglomerates Disney, Warner Bros Discovery, Comcast and Paramount “are facing pressure to shrink or sell legacy businesses, scale back production and slash costs following billions in losses from their digital platforms.” With the advertising market in a bit of a slump, TV revenues falling and increased costs the streaming landscape in 2024 is looking tougher than ever.
So what does that mean for us, the streaming subscribers?
“The only thing they know how to do to survive is try to merge and cut costs”
The FT spoke to Rich Greenfield, an analyst at LightShed Partners, who says that the industry is in a state of “complete and utter panic”. With cord-cutting accelerating, TV advertising revenues falling and the cost of showing sports increasing “everything is going wrong that can go wrong”. Increasing borrowing costs are a huge issue too: many streamers are carrying serious amounts of debt that is becoming even more expensive to service.
We’ve already seen price increases across the board; many industry watchers now expect the next move to be mergers and consolidation, with streamers either acquiring each other or licensing their movies and shows to multiple outlets. Netflix in particular is likely to be the big winner there, as that’s where the most eyeballs are.
Variety says we should expect much more content being licensed to Netflix, a U-turn for many studios. “The next year is certain to see more licensed titles flowing to the platform, as its rivals-turned-suppliers seek more cash infusions to brighten their balance sheets and help push their streaming businesses into the black.” Many studios have set a self-imposed deadline of late 2024 to become profitable, Variety says, and that’ll add extra urgency to their money-making.
As for Netflix, Variety expects it to build on its experiments with live sports streaming and to continue with its attempts to build its hits such as Wednesday and Peaky Blinders into franchises, and to push harder on its gaming division too. As the only streamer that seems to be doing well right now Netflix has something its rivals don’t: time to figure out where it wants to go next and how it’s going to get there.
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