Even just a few years ago, many of us naively believed that streaming services would act as ever-evolving libraries of content that we could return to whenever we needed to watch our favorite videos. desired program. Then, last year, Warner Bros. Discovery has fired first big shot in The Great Write-Down. Disney following last month and now say there’s more to come, Diversity report.
After scrapping shows and movies like Willow, Y: The Last Man, Dollface, and Mysterious Benedict Society, Disney is expected to incur a $1.5 billion content infringement fee, meaning the public You can remove that amount from your tax return. That’s a number that can’t be ignored – it’s a savings equivalent to a handful of Marvel movies. As a result, Disney is said to be continuing to review content on both Disney+ and Hulu, and “now anticipates additional produced content will be removed from DTC and other platforms, largely for the time remaining. back of the third fiscal quarter.” That would likely equate to about another $400 million in impairment fees related to produced content (which mostly means scripted TV and movies).
Since the early days of Netflix creating streaming content for its platform, streaming services have grown and expanded their libraries. So many people have joined streaming services, however, that growth is slowing dramatically; not much new customers as before. It’s about retaining existing users and bringing back other users who have switched to other services.
A more reliable way to help widen the gap between spending and revenue is to focus on finding ways to reduce costs at the backend. Placing content that Disney feels is more expensive than it is worth means the company doesn’t have to pay the rest of the money to actors and writers (who later currently on strike for better pay among other things) and no licensing fees to external parties.
Disney CEO Bob Iger said on Disney’s most recent earnings call that he “believes we’re on the right track to deliver long-term profitability to the streaming service,” and that the company will “streamline the volume of content we create and what we’re spending.” Iger also expects that Disney will increase the price of my Disney+ service “to better reflect the value of our content services.”
We can expect more of this kind of news than just coming from Warner Bros. Discovery and Disney, but also companies like Amazon Prime Video and Netflix, are followed by newer options like Peacock and Paramount+ in the coming years as they seek sustainable returns. of slowing growth.
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