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Streamers are Full of Duds

The FT reported that the streamers have significantly raised their prices:

The era of cheap streaming is ending, as Hollywood’s largest studios turn the screws on customers with price rises that rival the expensive cable television “bundle” consumers began ditching for Netflix 15 years ago.

A basket of the top US streaming services will cost $87 this autumn, compared with $73 a year ago, as Disney, Paramount, Warner Bros Discovery and others have raised their prices in response to pressure from Wall Street to end the profligacy of the streaming boom. The average cable TV package costs $83 a month.

Big media companies, many of which now run streaming networks, have faced substantial revenue losses from multiple sources, including theatrical ticket sales, international markets, cable TV subscriptions, and after-market Blu-Ray and DVD sales.

In the past, Hollywood trade publications publicly reported performance data for movies and network shows. However, in the streaming era, this information is closely guarded by the content owners who own the content and operate the distribution channel so no longer need to report numbers. This secrecy likely conceals many underperforming investments. My hunch is that if the streaming networks were to reveal their viewership data, the widespread underperformance of their original content would be extremely embarrassing and lead to collapsing stock prices. I bet underperforming content is leading to subscription churn and stunting subscription growth. Suffice to say, it's no surprise the streamers are raising their prices.

If these companies don't act more responsibly, it's not difficult to envision a future with significant consolidation.