The idea of commercials is something that people have been thrilled to be rid of. Streaming was terrific not just for its vast amounts of content but also for the promise of uninterrupted viewing. Many of uscut the cord to cableand never looked back. The problem is that streaming services have caught on to the fact that we’re all a bit too comfortable with how they have been running things.
In fact, we’ve already seen this with their slow-down of full-season releases. But now,Prime Videoand others are starting to bring back our once-defeated foe: Commercials.
They Know What You Want
An old saying is, “Give them the first one free.” The thought process is that if someone gets something they really want for free, they will be willing to pay for the same product later. This has been the idea behind streaming services since their inception.
There have always been first-month-free type programs, but Netflix pioneered the subscription service. They realized that people were thrilled to pay just a bit more toget their DVDsin the mail and keep them for as long as they wanted. Therefore, the next logical step was to offer these same people access to even more content whenever they wanted. But, with access comes a price. Everyone that has ever tried getting into an exclusive club knows that. And we are a society that loves exclusivity.
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Now, we have more than just a handful of streaming services, each with its own offering. They try as hard as possible to keep their content to themselves. This is all well and good, but if they are not producing enough engaging content, people will not come back. But this means that they need to spend money to make shows and movies.
So, where does that money come from? Well, it comes from you. Rates go up, people pay a few extra dollars a month, and they watch a few new programs. But that only pays for the programs. It doesn’t bring in nearly as much profit as the studios want to promise their stockholders. This leads to them trying to figure out the next steps. With cable still an option, people could technically just stick with “regular” television. But that’s no good. However, with streamers keeping all content for themselves, cable is becoming irrelevant. That means that people are now forced to use streaming services. So streamers now have a new term they have begun introducing: tiers.
Steps Are Being Taken
Although the tiered system already exists, people are starting to sit up and take notice now that it is happening on Prime Video. At the moment, one of the first to institute the tiered system is Disney+, where their lowest tier is shown ads during both movies and TV shows. However, you can pay extra to see fewer ads or none at all.
Now, Prime Video is going to be instituting the same type of program. Stay at their lowest tier, and you will see the same kinds of ads that you would see on standard television. They have stated that it will only be ten minutes of ads per hour, but there is no chance that it will stay at such a low number. Again, they start you with something that seems innocuous and then hit you with the hard stuff.
At the moment, they are saying that ifyou’d like to avoid ads, it will cost an additional $3/month, which may not sound bad to everyone, but consider that number as just the first. Then, spread it out over every streaming service you have. For some people, that could mean an additional $20-25/month to start, not to mention the fact that this tiered system will continue to expand until only the most elite services can access full libraries.
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Anyone with Prime Videohas already experienced this. They are known for listing a multitude of options that are only available as an additional rent or buy option. At the moment, the other services do not have this type of block in place.
Therefore, people will begin paying their extra $3 but will find that within a year or two, that price has doubled, and they are now paying three times as much for their streaming content. Studios will claim it is an inevitable part of the process and that they need to pay their writers, directors, and talent. However, the real winners are the stakeholders and top brass bringing home enormous checks by blockading content from those who can’t afford it.
What Happens Next?
Heading into the future, we’re going to see big changes. The main ones that we have discussed are price hikes. When Warner Bros Discovery CFO Gunnar Wiedenfels said, “an enormously valuable amount of quality content has been given away well below fair market value,” he meant every word. We are about to see massive price hikes and major streamers making deals to monopolize the industry and buy up their smaller competitors.
The inevitable future? The streaming package. Right now, there are companies that are bundled, such as Hulu and Disney+, because they are owned by a single entity. But just because cable is dying doesn’t mean its model doesn’t work. It just needs tweaking. That is why there will be one or more services that will start making deals with multiple streaming services so that you will pay one price to get a variety of streamers at once. But this will also come with tiers and will be made as hard to understand and compare as possible.
