The world felt like a much simpler place when the only major streaming service available was Netflix. If we wanted to watch live television, we tuned into our favourite channels, and if we wanted to watch our favourite films or shows from the past or perhaps one or two exclusive experimental shows, we watched Netflix. It was a simple system, and everybody understood how it worked. Within the past few years, the whole streaming scene has gone crazy.
There are far too many streaming services competing for the same spend from the same demographic, and it isn’t sustainable. Running a streaming service is a massively expensive endeavour, and customers only have so much money. Something had to give eventually, and there are signs that it’s finally beginning to happen. The streaming wars might be coming to an end.
Discovery and HBO Max To Merge
The longest of journeys, as the old saying goes, begins with a single step. Neither Discovery Plus nor HBO Max is the biggest streaming service in the world. They’re certainly not Netflix, Amazon Prime, or Disney Plus. They’re probably not even Apple TV or Britbox. However, they’re both streaming services attached to large, well-known companies – and they’re coming together. Rather than competing against each other, HBO Max and Discovery Plus are to merge.
This probably isn’t the biggest surprise to anyone who’s been paying attention to the news, as Discovery and WarnerMedia are in the process of a much larger merger, but it’s still an essential first step on the long road back to sanity. Rather than thinking bigger, the people behind Discovery Plus and HBO Max are thinking smaller.
The news will probably come as a relief to customers who’ve ever tried to watch anything on HBO Max, which is notoriously glitchy. Discovery Plus is a much smoother app, so if the content of HBO Max can be blended with the operating software of Discovery Plus, it should result in a much better product for everybody. What isn’t clear yet is how much that product is likely to cost. As of the time of writing, a premium subscription to Discovery Plus costs £7 per month, and a premium subscription to HBO Max costs £15. If we had to guess, we’d say the new (as yet untitled) service will either move to £15 across the board or settle on a price somewhere between the two. No matter what’s decided, it will be one less player in the extremely crowded streaming marketplace.
Comparing The Market
This day has been coming for a long time, but anyone who’s studied similar business models and similar marketplaces where saturation has taken place will have anticipated it. The over-the-top streaming platform is, after all, an idea that was taken from the incredibly lucrative world of online casinos. During the boom years of casino sister sites on the internet, almost anybody could set up a casino website and make money with it. That was until stiff competition came along, and that competition came with greater regulation.
Suddenly the market was choked, and only the strongest survived. Information started to become easier to find, too. People wanted to know the difference between one casino sister site and another, so comparison websites sprang up and pointed people in the right direction. You can check out SisterSite if you want more information about that, but the point is that saturation led to dilution, undercutting, issues with the regulator, and then disaster even for some of the strongest early runners. Those casino sister sites that have survived into the 2020s tend to be the hardest of them.
Because the basic idea is the same, it was inevitable that the same issues would occur. The idea of an over-the-top streaming service is to take as many films and television shows as possible and put them in one place to attract paying customers. The idea of a casino sister site is to take as many casino games as possible and put them in one place to attract potential paying players.
Even with the best will in the world, those players only have so much money and so much time. Once the excitement of the boom period is over, they’ll inevitably spend their money only in the places where they know they’re going to get the best quality. That’s what’s happening right now in the streaming market. HBO Max and Discovery Plus are two of the first big names to (in a manner of speaking) fall by the wayside. There will be others.
Not Getting The Message
Although it seems to be clear enough to most industry analysts that there’s no more space in the market for another subscription streaming service, there are still companies out there trying to get them off the ground. In the UK, ITV will launch a new platform called ITVX at the end of this year. For those unfamiliar with the broadcaster, ITV is second only to the BBC when it comes to viewership and popularity in the UK. For ITV to launch a new streaming service is a big deal – but it’s also surely far too late in the streaming age to achieve anything with it. ITV says it wants to become a “national champion” for the UK and compete against Amazon and Netflix on a global level, but the two giants have too big a head start for that to ever happen.
The new ITV platform will be free at the point of use but supported by advertising and will take the place of the company’s existing ITV Hub service, which focuses solely on catch-up viewing. Potential viewers have been promised an exclusive premiere every week and fifteen thousand hours worth of content from the point of launch when IT goes live on an as-yet-undetermined date later this year.
It would have been an attractive proposition ten years ago, but whether there’s an audience base therefore it now remains to be seen. The fact that it’s free will help, but even a free service isn’t guaranteed to find viewers when there’s so much content for people to watch elsewhere.
ITVX is an outlier. The merger between Discovery Plus and HBO Max is likely to be the way of the future. It’s been a long time coming, but the world of TV streaming is about to shrink.