Netflix, Amazon Video, and Xfinity are accidentally re-creating cable TVAugust 13, 2018
Since the advent of streaming online video, industry insiders have wondered what impact it would have on the future of television. As more companies move toward launching their own proprietary subscription streaming services, the future hasn’t been entirely decided yet, but new clues are emerging, pointing toward a potentially surprising answer: all this disruptive new media is just gradually re-creating familiar old-media models.
Recently, Comcast announced that it struck a deal to add Amazon Prime Video to the online content available through its Xfinity X1 service. Amazon’s original content will join other services available through Xfinity, including Netflix, YouTube, and Pandora. In a statement, Comcast’s president of consumer services, Dana Strong, argued for the addition: “Amazon Prime Video’s growing list of originals, movies, shows, documentaries, and kids’ programming will be an excellent complement to the overall X1 viewing experience.”
This is a big deal for Amazon, which had previously refrained from partnering with any US pay-TV service to offer Amazon Prime Video. (The full scope of the deal is unclear at this point; neither partner revealed financial terms.) It’s arguably a bigger deal for Comcast, however. The partnership lets it remain relevant by allowing it to at least temporarily bypass the existential terror felt by cable providers in response to cord-cutting, the trend for viewers to shift from traditional cable television to streaming services.
To put the scale of the potential threat of cord-cutting in perspective: for more than a year now, Netflix has had more subscribers in the United States than cable television, and the speed of changeover is only increasing. According to eMarketer, an estimated 22.2 million people switched from cable subscriptions to streaming content in 2017, a 33.2 percent growth over the previous year.
In theory, the partnership between Comcast and Amazon is a win-win for both parties. Tammy Parker, a senior analyst at GlobalData, echoes that view in a press release about the deal: “It further helps position Comcast as a preferred content curator in the minds of consumers, many of whom are growing fatigued with the dizzying number of choices they have for watching multiple video services over a myriad of devices,” she says. “The deal is also a positive for Amazon, which wants to get as many people watching its content as possible.”
Parker’s commentary suggests that the deal is good news for all parties, but she touches on something in passing that shouldn’t be overlooked: end-users are “growing fatigued with the dizzying number of choices they have for watching multiple video services over a myriad of devices.” At one point, switching from traditional television to streaming was a simple proposition that involved one or two online subscriptions, with Netflix and Hulu as the hubs for the majority of available content.
These days, small, niche streaming services like Shudder, Filmstruck, Fandor, Crackle, and Mubi are proliferating, while major studios are moving to establish special subscription services for their own content. That’s likely to change the audience’s attitude toward, and relationship with, streaming content moving forward.
For example, imagine what the science fiction fan of 2019 will need to do to keep up with the genre’s most prominent franchise content. Star Wars will live on Disney’s new proprietary service, but new episodes of Star Trek (both Star Trek: Discovery and the upcoming Next Generation sequel) are only available on CBS All Access. Meanwhile, The Expanse is exclusive to Amazon Prime. If fans want to watch DC’s superhero shows, as well, that’ll require a DC Universe subscription — although the CW shows featuring DC characters will only be available via the CW app — or, for patient fans who want a commercial-free option, Netflix. If they want to catch up on classic Doctor Who, they’d better have a Britbox membership.
The digital landscape is already fragmented, and it’s continually fragmenting further, as content creators choose to become content providers. In the process, it’s beginning to resemble cable television. Each new app or content library looks like a different channel to consider, and each one is essentially a premium cable offering that requires a separate subscription to view. Services that previously acted as content aggregators are losing outside content with the launch of each new service. Instead, they are creating their own content to maintain value in a crowded marketplace. Even YouTube is getting in on the act, creating more and more channels for viewers to choose from.
As if to emphasize the idea that streaming is just re-creating the existing television landscape in a different venue, CBS recently announced the launch of CBSN Local, a local news addition to its CBSN streaming service. CBS Television Stations president Peter Dunn called the service, expected to launch at the end of 2018 in New York, “the exciting next chapter in how our stations will serve audiences seeking local news on all of the most popular content consumption platforms.” Now, even through streaming services, viewers will be able to view localized meme-ready material from wherever they may be at the touch of a screen. (To be fair, this has been expected for some time.)
If streaming is, indeed, just New Television — or, perhaps more accurately, Old Television Again But Arguably More Expensive And More Complicated — then what benefit does that actually have for the end-user? The material has migrated to platforms where the audience already exists, but in a more unwieldy fashion that all but eliminates the free-view option of broadcast television, limiting its potential audience and penalizing low-income customers.
There are still some free streaming options, but they are limited, understandably. Hulu dropped its ad-supported free option in 2016, but the CW’s proprietary app still works on that model. CBSN and the upcoming CBSN Local are both free-to-view, working off of the reasonable assumption that no one wants to pay a monthly subscription fee for TV news these days. But given the widespread failure of online advertising, it’s not too surprising that paid subscriptions are the normal business model for most streaming content.
The issue of complication can be more easily addressed, however. With each separate streaming option requiring individual logins, passwords, and payment options, it feels like just a matter of time before some internet service provider starts offering bundled streaming subscriptions that require one payment and one login, a la the traditional bundled cable subscription model. (Comcast’s Xfinity X1 still requires multiple logins for each individual service.)
Amazon has already taken steps toward this idea. Its customers can subscribe to different content providers through Amazon Video Channels, including traditional television providers like HBO and Showtime as well as streaming content providers like Britbox and IndiePix Unlimited, then view them all through Amazon Prime Video. Individual accounts and payments are still required, but the notion of one killer app or portal that allows access to everything is such an enticing idea that it’s difficult to imagine that companies aren’t already discussing the possibility. And Xfinity’s deals with Netflix and Amazon suggest that even guarded companies with a strong proprietary interest in their original content are willing to come on board.
This is just a variation on what cable companies have done for television channels for decades. Streaming content originally appeared to offer a direct alternative to that model, but service providers and content creators alike can see a lot of benefits to resurrecting the concept. Service providers offering cross-platform streaming bundles get to boast about offering such an extended range of viewing options while making access easier than ever for users. Content creators can once again leverage desire for high-demand channels to push additional offerings of lesser popularity. It’s the win-win strategy of the Comcast-Amazon partnership (taken to a further extreme, in theory), but it’s also exactly the content delivery model that has been on offer for decades, merely ported over onto a new platform.
It’s like Lyft accidentally reinventing the bus with its Lyft shuttle idea. With such focus on innovation and disruption over everything else, we’ve seen companies lose sight of the bigger picture, and they end up restoring the status quo of before. Is it possible that, after all of this change and innovation, the future of television is just… television?