Remember that time when the only streaming platform you had on the entertainment menu was Netflix. Those were simpler times weren’t they? All you needed was a high-speed AT&T internet plan to complement it and the weekend was sorted.
At the time, none of us knew that the emergence of streaming platforms like Netflix and Amazon Prime was a watershed moment in the history of the entertainment industry. Over the years, these platforms, with the help of others, would in change the way audiences consumed content.
Netflix’s, and to some extent Amazon Prime’s, success inspired several other companies to hop aboard the streaming bandwagon. Companies from Apple to Disney wanted a slice of the pie and they were willing to spend as much money as needed to become successful; the streaming wars had officially begun.
The Streaming Wars
Although streaming wars include a lot of participants, the main battle is between Netflix and Disney. The former is the undisputed king of streaming services while the latter is the biggest company in the entertainment world with a massive content library.
Since the time it announced the launch of Disney Plus, there was speculation on Wall Street that Disney was going to give Netflix a tough time. However, nobody could have predicted Disney’s exceptional performance in just a couple of months after its launch.
In just 3 months, Disney Plus had more than 28 million subscribers. To put things in perspective, it took Netflix 5 years to reach the same number.
Disney Plus’s success also encouraged other media companies to enter the streaming world. There were announcements for the launch of new streaming platforms like HBO Max and peacock—both platforms had the backing of major telecom companies like AT&T and Comcast.
The streaming wars have certainly intensified and with the unexpected emergence of the COVID-19 pandemic, an array of opportunities have sprung up for these platforms to capitalize on.
While market leaders such as Netflix and Amazon Prime have a loyal customer base, several other promising platforms have emerged in the last 12 months. Let’s take a look at how each of these platforms has fared during the streaming wars.
Disney Plus
We have already talked about how Disney Plus has been a massive success since its launch in late 2019. As of August 2020, the platform had more than 60 million subscribers and in the words of the company’s CEO, Bob Chapek, the numbers have exceeded the management’s expectations.
The platform hasn’t just been a success in the United States, it has also been a huge success in Europe, where it was launched at a time when countries were going through stringent lockdowns to curb the spread of Coronavirus.
Audiences had no choice but to stay indoors and needed entertainment options; Disney couldn’t have asked for a better launch opportunity.
The success of Disney Plus had a lot to do with the Disney brand itself. Since day one, the company had invested everything it had into promoting the platform and one of the ways they did that was through tactical bundling.
The company joined hands with television and mobile service providers such as Verizon, Movistar, and Deutsche Telekom. They also bundled with other company platforms such as Hulu and ESPN.
There is one catch though; there seems to be a scarcity of content on Disney Plus, something that the company is addressing by investing heavily in new productions. Analysts agree that unless Disney offers new content to the audiences, it might struggle to maintain its momentum.
HBO Max
HBO Max launched on 27 May 2020 and is a direct-to-consumer video-on-demand service for all AT&T’s Warner Media content. Currently, the service is only available in the United States.
Anyone who had already subscribed to HBO automatically got a subscription to HBO Max. Using this strategy, the company was able to acquire more than 36 million subscribers in the United States. Just a month after its launch, HBO Max also claimed to have 3 million retail subscribers.
In addition to that, 1.1 million HBO subscribers also activated their HBO Max subscriptions bringing the total number of retail subscribers to 4.1 million. At this rate, AT&T predicts that the company will manage to get 50 million subscribers by 2025.
There are some customers who might be put off by HBO Max’s high subscription fee. At $14.99/ month, HBO Max is one of the most expensive streaming platforms out there.
Analysts explain this high price by pointing out that the HBO Max has two main targets with the high subscription fee — the first target is to convert HBO and HBO Now customers into subscribers, and the second is to reach out to customers beyond the HBO target audience.
HBO Max’s content strategy also focuses primarily on producing premium and exclusive content. HBO has always had a reputation for producing some of the most popular TV shows in the United States and HBO Max is leveraging that reputation to acquire new customers.
Of all the new services, HBO Max has the highest number of TV series in commission. The content ranges from reality TV to kid shows. Time will tell if the company’s strategy will work out in its favor or not.
Peacock
NBC’s Peacock is still a relatively new service that was first introduced to Comcast subscribers in Mid-April before getting an official launch in July. Peacock is different from other services in that it offers free basic service funded via advertising.
The platform has reportedly hit 10 million sign-ups however no details have been provided regarding which of the three subscription tiers users had signed up for. The three tiers included:
- Free
- Premium ad-supported service for $4.99 per month
- Ad-free for $9.99
According to company CEO Jeff Shell, the streaming service looked at three metrics; signups, monthly average users, and monthly active accounts. He also further stated that the platform’s performance had exceeded expectations.
The COVID-19 situation has been quite challenging for Peacock since the platform was expected to launch with the Summer Olympics. But the event was postponed due to the raging pandemic. It was also going to provide a live stream for the Summer Games in Tokyo.
Despite the setback, the company managed to launch the platform as per the agreed upon schedule. However, it remains to be seen if it will be a success in an increasingly competitive market.
Apple TV
The tech giant has still not released any numbers related to the performance of its streaming platform so it is very difficult to comment on the platform’s performance up till now. The only thing that is known is that Apple is offering free subscriptions for a year to its new Apple iPhone, iPad, Apple TV, iPod touch, or MacBook customers.
There were reports that the platform had more than 33 million subscribers in the US alone. However, a major chunk of these subscribers are getting the service for free.
The biggest challenge that Apple is facing right now is ensuring that people continue to use the service once their free subscription period ends. The platform’s second challenge is developing a content library.
Right now Apple has very little original content, and to counter this problem the company is looking to acquire licenses of old TV shows. The platform has also acquired film rights but it will be sometime before the streaming service can come off across as a credible competitor to other streaming companies.
The Effect on the Establishment
In spite of the emergence of competitors, Netflix still retains its spot as the top streaming service in the United States. The company had a great 2020 and added an additional 26 million subscribers in the first two quarters alone.
The company’s stock reached its highest point during 2020 and reports indicate that the company will continue to progress in the upcoming years. However, it is safe to assume that the company will have to be at its A-game to give solid competition to its rivals.
