In the last few years, the world of streaming has become overcrowded with companies elbowing for their place in this lucrative industry.
Established platforms like Netflix and Hulu have faced stiff competition from relative newcomers like HBO Max, Apple TV Plus and Disney Plus (which has the same parent company as Hulu). In the coming year, media and tech giants will likely focus less on launching new platforms and more on ensuring that existing ones survive.
For customers, this will likely mean higher bills.
“Companies are starting to see where they’re bleeding from this fight that they’re in,” said CNET senior media reporter Joan Solsman. “The way that we were approaching streaming was how you build a service, and now it’s shaking out who’s going to survive and who’s not.”
Streaming companies have to navigate a complex landscape. While they look for ways to increase profit, they also have to deal with the reality that some customers are looking to cut back on mounting subscription costs. Last year, Netflix, the company that essentially pioneered streaming as we know it in 2007, saw its biggest ever drop in subscribers, scaring rivals, which had essentially modeled their services after Netflix.
In 2022, Netflix and competitors like Disney Plus and Hulu rolled out higher prices.
“All those companies realized all at once that everybody needs to start charging more if their business is going to be viable,” Solsman said.
But Netflix and Disney Plus also added cheaper ad-supported tiers in 2022, to entice subscribers to stick around.
“The services like those ad-supported tiers because they actually make more money when you’re paying and advertisers are paying for that single account,” Solsman said. “So you’re going to see these services really promote those ad-supported tiers a lot.” That could mean companies will charge even more for ad-free tiers, to lure customers into cheaper, ad-supported options.
Mergers, like HBO Max-Discovery Plus and Paramount Plus-Showtime, are perhaps the biggest indicator that the streaming industry is maturing and adapting. On the one hand, this means you can find more content on a single platform, instead of hopping between so many services. But it comes at a cost — meaning price hikes.
“Because so many of these services are part of big companies that bet so many billions of dollars [on streaming], it’s likely you’re going to see more of these companies combined going forward,” Solsman said, “because the only way you can survive is to be gigantic.”
Check out the video above for more on what changes we could see from streaming platforms in the coming year.
