When Disney announced the launch of its own streaming platform, the competition began to tremble. Not so much because their offer of originals was going to take over the market, which in part also, but because they began to withdraw and concentrate their classics in a gigantic catalogue of familiar content capable of attracting the next generation of viewers: the most avid consumers of on-demand content. Not surprisingly, according to Netflix’s own data, 60% of its subscribers watch children’s series and films regularly.
In short, Disney+ debuted in the U.S. on December 12 and, according to the company’s own data, in just 24 hours it had more than 10 million users. Until December 11, the app was downloaded 22 million times, with 85% of those downloads occurring in the United States, according to the Apptopia website. The catalog includes Disney’s own library, with about 500 films and 7,500 episodes of television series and programs, the film universes of Marvel and Pixar, the 30 seasons of ‘The Simpsons’ or the saga of ‘Star Wars’, as well as original series and films derived from these properties.
One of the first companies to fight back against Disney’s landing on streaming was Netflix. To begin with, it has signed an agreement with Nickleodeon to offer its series and develop new original productions based on some of its most popular characters. Like a ‘spin off’ of ‘SpongeBob’ starring Squidward Q. Tentacles or a special of ‘A Crazy House’ in the style of ‘Rise of the Teenage Mutant Ninja Turtles’, of ‘The Ninja Turtles’. According to The New York Times, this agreement is valued at 200 million dollars and will last for several years.
HBO Max has closed a deal with Sesame Street. The next WarnerMedia platform, whose debut in the United States is scheduled for spring, will host five decades of programming by the production company, which will also create several new series and derivative programs. The catalogue will also include the contents of Cartoon Network and the complete catalogue of Studio Ghibli.
The exception is Amazon, which in the face of the push of its competitors has decided to reduce its investment in original children’s production, as published by the Los Angeles Times, in order to focus on acquiring them. It is also possible that it is spending its entire budget on the expected multi-million dollar adaptation of ‘Lord of the Rings’.
But it is not all joy; it must be noted that this is a highly indebted market. Spending on in-house production and agreements to acquire licenses have led these companies to borrow $500 billion. Will 2020 be the year of the bubble bursting? Of course, keeping up with the pace of premieres – 532 series last year – would be a feat. And perhaps a foolhardy one. But platforms are caught up in this dynamic because it is a subscription-based business, not an advertising revenue-based one (at the moment).
They don’t need advertising, but they will end up needing it, experts predict, because the bills don’t come in. As Bezos taught before he became the richest man in the world, they don’t need to come out… as long as you annihilate your rivals but some of them have deep pockets or share business with cable TV providers, with strong roots in society. So Netflix tries to convince viewers that his catalogue is so extensive that he shouldn’t go to the competition. And he spent $15 billion last year on his own production to prove it. But the competition has the same idea. Result? More wood!
First victim was YouTube Premium, whose series has been free since January. The payment didn’t work. There’s not room for everyone.