Netflix is going to become more expensive regardless of net neutrality. They’ve already started the process of raising prices (and as more people want UHD content they’ll be paying the even higher tariff) and if you read their financials it’s a key part of their strategy to get higher revenue per user. US subscribers are basically flatlining.
Incidentally, they raised another $1.6bn of debt yesterday, paying just under 5%.
Paying $8/mo for potentially several people viewing all the content in the world is not a realistic proposition and I’m surprised it lasted as long as it did, to be honest. I feel like they’re probably losing more revenue to account sharing than the per-account fee, though, and they don’t seem to have any sort of policy against it or enforcement thereof.
That was the price before they raised it last year to $10 a month. It’s supposed to go up again soon above $10/mo.
No, I know. But I am saying that paying that forever wasn’t realistic. I don’t know what a sustainable monthly price looks like but I doubt we’ve hit it yet.
We are now paying for 5 streaming services/channels: Crunchyroll, Netflix, Hulu (haven’t actually watched anything on this…we signed up because we thought something was available that wasn’t), and two of Amazon’s channels. On top of that, we still had a massive cable bill. So I got together with my wife and we agreed to drop the movie channels, which ended up saving us over 100 bucks a month, which more than pays for those services.
I find some of those statistics wrong, taken out of context, and cherry-picked to support cable TV which is rapidly faltering. Michael Mulvihill is a Fox Sports programming researcher (I think, correct me if wrong), with probably an interest in live cable TV.
I’ve also done a lot of surveys and there are all kinds of issues, and even ‘experts’ really don’t know how to deal with the issues there are e.g. intercept vs telephone vs online, stated preference vs revealed, expansion methods and control totals, query grouping - I’m just getting started. Just because it’s Nielsen doesn’t mean the finer statistics are reliable.
He also makes his own interpretation rather than points out actual statistics from the report. The average adult watches 13 hours of streaming video on demand a month? Yeah that’s low. Wait a minute, no it’s not. 250 million American adults x 13 hours… is crazy lots. Plus only 50% of homes are SVOD subscribers, plus a lot of the younger generation watch streaming without being subscribers. 20% of SVOD is original content, that’s low he points out. Wait, actually it’s not. What percent of all programming is VOD original content? 0.5%?, so that 20% is actually insanely high.
Personally I don’t believe the 89.5% statistic either, and I can’t find it on the Nielsen site. The published report available online is dated March 2016 and refers to surveys in summer 2015… actually things have changed quite a bit in the last 2 years. Here’s just one source I found:
Here are a few current quotes a quick search turns up:
AT&T’s Cable Business Continues to Be Savaged by Cordcutting
and,
This year, there will be 22.2 million cord-cutters ages 18 and older, a figure up 33.2% over 2016. The overall tally is much higher than the 15.4 million eMarketer previously predicted. Meanwhile, the number of US adult cord-nevers will grow 5.8% this year to 34.4 million.
When I cut my cable, they begged me to stay. Honestly anyone on here paying anything more than $60 a month, regardless of 6,000 channels or whatever, is paying way too much. Then when I told them “I’ haven’t watched 30 seconds of TV in the past six months”, it was funny. The girl who had been probing me basically stopped and said “oh you’re like everyone else, I’ll stop bothering you” and she proceeded with the cancel.
Thing is among the over-60 crowd, there are tens of millions of elderly people addicted to live news, live sports, and their favorite sitcoms. The fact that it’s still a huge market is ultimately not very meaningful in the light of these short, medium, and long-term trends.
And my college roommate and best friend, but yes, do go on.
In any event, for the entire network they did a study in coordination with Nielsen metered numbers to determine how much time people spend watching entertainment on screens. TV programming, streaming services, whatever. Mobile, TV sets at home, computers. They published their numbers, and his extrapolations are based off that data.
And here’s the thing I’m not sure y’all are quite yet grasping. Are Nielsen’s numbers flawed? Hey, they might be. I don’t know either way. But what I do know is this:
It doesn’t matter.
They remain, still, the only game in town, and their numbers are still gold to the people who matter: programming executives and advertising executives.
Until someone provides counter-data that comes into wide acceptance, everything else is noise.
Anyway, here let me help with some more data.
And, in any event, the numbers still stand: people are not watching as much original programming SVOD as those services would lead one to think.
And for Netflix, perhaps it is the long game to attract and hold a subscriber base who will willingly absorb subscription fee increases over the next handful of years. But I think there’s also a point to be made that fragmentation of streaming across so many services has created an issue where it is possible for shows to come and go and fade away into memory and even if they’re available with a streaming service, they still may not find even a willing audience.
Maybe true, though to me 20% is a lot. The last three years have seen a huge growth in VOD subscriptions, but we still have a huge legacy of network based TV series that are still active. If the question was “of the new series that you’ve started watching in the past year, what percentage is original content vs network?” Then, the answer would be much higher for video on demand. For me it would be 90%.
Also what percentage of households are holding on to cable for the singular reason of live sports? Pretty high. Once that barrier falls, and it’s very early days for that, I think there will be a very rapid loss in cable subscriptions.
Anyway all this and I share your point that revenue per viewer is going to go down which will be bad for the programming and bad for the economy of Los Angeles and more.
One other thing worth noting – and I’ll try to find the tweet that referenced it – but this past spring I think a Nielsen survey returned responses from viewers beyond just watch numbers. And one thing they were asked was a one word description for TV choices right now.
69% (nice) chose “overwhelmed”. That’s probably more bad than good.
They called me to participate in a box survey, aka they sent you a box to report your viewing habits. I did not qualify because I do not use an antenna and do not have cable. They were not interested in anyone who only streams content.
I’ve been doing their dairies, for years.
Now that I can believe. I sure feel that way.
Anecdotally related to your friends specific job, I meet a LOT of folks younger than 30 who do not watch any sports at all. The reason given most often? “I don’t have cable.”
As a cord cutter I had a tough time letting go of some of the sports networks and games. If anything, there really needs to be a good offering for that via streaming. You can piece together a little (ESPN on a couple of streaming services) but that leaves out sports packages unless you want to stream them to a PC/laptop. When I had NHL Center Ice a couple of years ago I had to stream it to my laptop, then cast it to my TV. All that work just to get around the fact that sports and cable/satellite are still in bed together and they need to separate, fast.
Just as anecdotally, I meet a lot of folks younger than 30 who do watch sports. And just as anecdotally, if you’re a cord-cutter and don’t have Roku, a game console, or Fire TV of something similar (all of which have MLB, NFL, NHL, NBA and Soccer apps), then you’re not a cord cutter. You’re some tiny subset caveman person who isn’t a cord cutter, but rather a Chromecast early adopter who can’t be bothered to get something more convenient.
MLB, NHL, and NBA have fully separated from their cable overlords. NFL hasn’t fully, because they think their product is more exclusive (and it probably is). Soccer hasn’t fully, because they’re worried about demand and decentralization.
But…if Mike had a dollar for everyone who thinks they’re the first person to have the notion of “What about cord cutters??? and Millenials!!!” and tweeted that at him daily, he’d have been able to retire a year ago. He’s addressed it often. Short answer: Cord cutting happens, and is happening. It isn’t growing or happening at a faster rate though, year-over-year (rate has been fairly steady), and still isn’t a huge influencer on network-broadcast sports.
Have to disagree as long as the yearly league offerings still have blackout restrictions (and I fully admit they’re trivial to get around).
Early into my cord cutting I did not. I do now, but having gone without sports packages for about a year now, I don’t think I’m going back.
Not trying to spin you up, Triggercut. I was mentioning an anecdote. I thought there has indeed been a drop in sport event viewership?
Or you spent a lot of time pirating TV and watching it on your nice big high-resolution PC monitor with headphones in your mid-20s.
Not, erm, that I’d know anything at all about that.
It’s possible I maintain a subscription to Hulu, which is almost useless for me, out of lingering guilt.
Same. Over the past five years or so, I’ve gone from closely following the NFL, college hoops, and MLB, to pretty much ignoring all of them. It wasn’t really a conscious decision, but looking back, the key thing was dropping ESPN.
Having stopped caring, I can’t see myself paying (money, time, energy, whatever) to get back into football or basketball. I still really like baseball, but MLB’s local blackout means no Cubs, no Reds, and possibly no Cardinals, and frankly I’m just not bothered enough to circumvent it.
Active, engaged fans will go to the trouble, but more casual observers? I was a little surprised at how easy it was to stop paying attention.
You know I think it was the same lynchpin for me as well. When you don’t have sportscenter blaring all the time it is very easy to forget how mind numbingly unimportant most of that stuff was. And how much it drove me to see so-and-so’s next game to see if they did whatever-it-was again. I check the scores for my teams online, that’s about it. If I’m somewhere with a game on I’ll watch it, but the draw is much less of a thing now that I took the needle out of my arm.
I can’t do it. I would miss Tennis too much. I need my ESPN 4 times a year on most years. And then I need my ESPN for World Cup football. Of course, now that they’ve lost the World Cup rights, I guess I need … Fox Sports?