Is Streaming Too Big to Focus on Prestige Content? Are All Services Going to Become Unscripted Hubs?
There’s no arguing the point that the streaming industry has grown unwieldy. There are simply too many subscription video services available, and streamers are being faced with hard choices about what they can do to boost profits and keep investors happy, while simultaneously trying to keep customers engaged with quality content.
New data from Variety's reporting of a presentation by Ampere Analysis is putting such issues into clearer focus. Variety spoke with Ampere analyst Guy Bisson, who said that once streamers are reaching a certain percentage of an addressable market, they can no longer afford to specialize in a particular genre of programming.
“Once you’re at 80% penetration, you’re effectively serving a generalist audience just by scale,” Bisson said. “And so your content strategy has to evolve to reflect your increasingly generalist audience.”
That means that once they reach a certain threshold of success, streaming services can no longer simply offer one genre, like horror or science fiction. They have such a large potential audience that they must tailor their content accordingly, offering shows and movies from across many different genres in order to appeal to the widest segment of customers possible.
This helps to explain why so many streaming services are leaning into unscripted reality content. Unscripted shows are less expensive to produce for streaming platforms, and they are highly popular among consumers, making them a win/win for executives who are trying to enhance the profitability of their service, as all in the industry now are doing.
The data would certainly help to explain Warner Bros. Discovery’s strategy with HBO Max going forward. The HBO Max brand will be sunset next month when WBD rolls out Max, its new streaming platform that will integrate much of the content from discovery+ with HBO Max’s library on May 23. Many of the new shows coming to Max from discovery+ are unscripted reality series, showing that WBD wants its service to have a broader appeal than to users who only want high-quality, scripted TV. Shows like “Succession” and “The White Lotus” may have passionate audiences, but they’re not enough to keep a streaming platform afloat by themselves.
This might suggest to the casual eye that streamers should give up their focus on niche, prestige content altogether. This is not the case, however; this type of programming will always be important for streamers as the buzzy, watercooler shows are often what attracts audiences in the first place; it is often the lower-brow, lean-back programming that keeps people engaged in between the big series.
This also doesn’t mean that specifialized, niche content doesn’t have a place in streaming either, as providers simply need to find the proper medium for shows and movies with a small but dedicated audience. Free ad-supported TV (FAST) channels can be the perfect avenue for the distribution of niche titles, as they allow streamers to continue monetizing segments of their audience, and allow those users to see their favorite content at an agreeable price. Ampere’s data shows that between 30% and 40% of domestic households engage with FAST content every month, so there’s clearly a customer base there for streamers to take advantage of if going the premium, prestige route doesn’t make sense.
The streaming marketplace will continue to evolve in the coming years, as streaming video becomes the primary mode of entertainment for more and more users. Platforms have to offer a huge breadth of content to satisfy growing audiences, but must also figure out a way to keep the prestige content that draws in audiences available as well.
Max
Max is a subscription video streaming service that gives access to the full HBO library, along with exclusive Max Originals. There are hubs for content from TLC, HGTV, Food Network, Discovery, TCM, Cartoon Network, Travel Channel, ID, and more. Watch hit series like “The Last of Us,” “House of the Dragon,” “Succession,” “Curb Your Enthusiasm,” and more. Thanks to the B/R Sports add-on, users can watch NBA, MLB, NHL, March Madness, and NASCAR events.