Streaming Killed Cable, Will Now Become Cable

Netflix, Disney+, Hulu, ESPN are all raising their prices. The numbers couldn't stay fake forever.

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In today’s #Content Report:

• Streaming killed cable, will now become cable.

• New Statham

• Katy Perry, real estate menace.

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Cable Is Dead, Long Live Cable

Photo by Austin Distel on Unsplash

One of the big issues in the writer’s strike was that writers wanted some system in place by which they would get paid based on how often people watched their shows. The streaming companies (most of whom are owned by larger corporate entities) fought this long and hard, most likely because they didn’t want to have to stop lying about their own numbers. The writers actually won that concession, so that now they will get paid more for more people watching, and almost instantly, it came out that Netflix is planning a(nother) price increase.

The Wall Street Journal was the first to report it, citing unnamed sources.

This comes after an earlier Netflix price hike in 2022, and CEO Spence Neumann telling investors that they were “more than a year out” on further price hikes just a few months ago. They had cracked down on password sharing instead.

But hey, why not do both??

In the U.S., Netflix’s Standard plan (two streams, no ads) is currently $15.49/month and the Premium tier (four streams) costs $19.99/month. This summer, Netflix eliminated the Basic tier without ads (which had cost $9.99/month) in the U.S. and other markets, in a bid to drive customers to the $6.99/month ad-supported plan or higher-priced tiers. [Variety]

These companies had basically been talking out of both sides of their mouths for years, simultaneously telling investors how many millions and billions of views their shows were getting to make themselves look more valuable, while telling the writers making those shows that being compensated based on views was unrealistic to avoid having to pay them more.

This was the business model Netflix pioneered (though it was largely just applying the tech/start-up model to entertainment), whereby they sold a story to investors promising infinite subscriber growth, where profits and costs didn’t really matter. Enough people bought that story that most of of their money came from those investors, rather than from advertisers or subscribers, as in the traditional model. They bankrolled countless shows based on it.

Everyone rushed to copy them, and we got more shows than ever at relatively low prices. The traditional cable user experience and cable as a general value proposition declined alongside the rise in streaming. We cut the cords! We liked it! (Mostly).

Then everyone sort of realized that the whole tech industry model only really worked in a low-interest rate environment. Oops! It was sort of funny at first, wiping out all the crypto guys and finally getting everyone to shut up about NFTs, forever.

But of course now the bills are coming due for the streaming industry. Disney, who own Disney+, Hulu, and ESPN, announced price hikes last month:

As previously announced, starting on Oct. 12, Disney+’s ad-free price will increase from $10.99/month to $13.99/month, with Hulu’s ad-free plan jumping from $14.99/month to $17.99/month. The ad-supported tiers of Hulu and Disney+, which are both priced at $7.99/month, will stay the same for now.

Hulu’s Live TV plan is increasing in price as well, with the ad-supported plan going from $69.99/month to $76.99/month, and the ad-free plan going from $82.99/month to $89.99/month. [IGN]

As with Netflix, this follows earlier price hikes in 2022.

Virtually every service has raised their prices in the last year. HBO raised their prices in January. NBCUniversal raised the price on Peacock in August. Paramount+ with Showtime (yes, they merged) went up in June. Discovery+ without ads increased prices 30% just today. A few weeks ago, Amazon announced plans to start putting ads in Prime Video, unless you pay an extra $2.99 a month.

Last week I tweeted about these price hikes, writing semi-jokingly, “can we just admit this was a mistake and go back to cable?”

A lot of the responses were along the lines of “No way, I have lots of subscriptions and it’s still better than cable!”

Look, cable sucked, no one denies this. Any business gets complacent and gougy when they basically have government-created monopolies. I remember when DirecTV refused to lower my rate to the introductory one even though I’d been paying them full price for like seven years. Couldn’t be done, they said! I had to actually cancel and send them all the equipment back and start a new account with a new dish. That lowered my bill by like half, which ended up costing them a ton. This kind of customer experience was what created the streaming market in the first place.

But when I say “go back to cable,” I don’t necessarily mean restarting contracts with the old cable companies (most of whom own streamers themselves — it’s not like these are even entirely separate entities, they just nurture the illusion of it). I mean go back to something that looks and feels a lot like the old cable model, with all or more of your channels in one place.

The general pattern of television throughout the years has been to make it easier to see what you want, and while streaming has certainly made TV cheaper (which, again, is changing fast), it hasn’t made it easier. That thing you do, where you stare at your Roku/Firestick/AppleTV whatever help screen trying to remember what shows you were watching and what networks they were on… isn’t a great system. Something about it feels homeworky and very un-TV. I know I probably shouldn’t feel nostalgic about just going to my DVR and pulling up the list of all my shows (whose networks I mostly didn’t need to care about), but I sort of do. It was easier.

Certainly it got progressively worse over the years, but now so is the model that replaced it. We’re fast approaching a point when trying to maintain a nest of streaming subscriptions is going to become more expensive (not to mention a huge pain in the ass) than just paying one company who, shall we say, “bundles” them. A few weeks ago, the New York Times reported that 500,000 people had downloaded FuboTV during Disney’s feud with Charter cable. Fubo is a streaming service that has a bunch of different channels, as does YouTube TV. Part of Charter’s resolution with Disney included Charter offering Disney+.

These are sort of new versions of cable in everything but name, and it feels like the direction things are heading. The CEOs of both Warner and Paramount are already talking about bundling like it’s a great idea (though making it actually happen requires agreeing on lots of other things too).

Without getting too in the weeds, the reckoning has clearly come for the tech business model that ruled the teens. We’re in the midst of a messy process whereby the fake numbers that drove a vibes-based economy have to Pinocchio themselves into realness in some basic way. I don’t want to predict exactly what comes next or how bad the growing pains will be, but the reckoning was overdue.

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New Statham!

Here’s Jason Statham starring in The Beekeeper. Much like Ben Affleck in The Accountant, Jason Statham’s character in The Beekeeper is an actual beekeeper. Whoy do dey cawl im da beekeepah? …Because ‘e keeps bees, doesn e Tommy.

David Ayer (the guy for whom Shia Labeouf got CREEPER tattooed across his stomach as part of his role in a movie no one really saw*) directs, and it seems like he went hog wild on the “annoying Zoomers dying gruesomely” theme.

As Matt Ufford tweeted me, “how much do you want to bet the whole idea for this movie started when someone learned honey is flammable?”

That sounds disturbingly plausible. I’m for it.

Whoy do oy love bees? Wew, dey's natchah's suicoide bombas ain dey, Tommy.

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Katy Perry: Real Estate Terrorist

My toddler woke up in the middle of the night last night and when I couldn’t get to sleep afterwards I fell down a Katy Perry rabbit hole. Apparently Kary Perry is currently in the midst of a legal battle with a guy she and Orlando Bloom bought a house from. The guy, who is 84 and has Huntington’s Disease, says he was in a drug fog after a spine surgery when he agreed to sell his 11-bedroom Montecito, California mansion to them for $15 million.

The guy tried to change his mind within days, but they wouldn’t let him out of it. Incidentally, this guy, Carl Westcott, is the founder of 1-800 Flowers and the father-in-law of Real Housewife, Kameron Westcott of Real Housewives of Dallas. And apparently they had outbid Maria Shriver for the house. Montecito just be like that.

It was at this point that I learned that Katy Perry also had to sue a group of nuns over a previous house. These nuns had been living in a “sprawling Roman-villa style convent” in Los Feliz for 40 years. The Archdiocese sold to Katy Perry, but the nuns didn’t like her slutty pop music (what they thought, not me) and wanted to sell to someone else. It played out in court, Perry won, and one of the nuns collapsed and died in the courtoom. Imagine how that’s going to play in the martyrs section of heaven. “How’d you get here?”

“Lions. You?”

“The chick from ‘Roar.’”

Now, in a Semafor article headlined “How Katy Perry inspired a wave of housing bills,” this:

Now, Carl Westcott’s son Chart and his family are spearheading the launch of the Protecting Elder Realty for Retirement Years Act, or Katy PERRY Act. According to a website shared with Semafor that launched over the weekend, the act “addresses the risks of elder financial abuse, especially as it relates to property and real estate sales and transfers. The Act establishes a 72 hour cool-down period during which either party involved in a contract for conveyance of a personal residence, in which one party is over the age of 75, can rescind the agreement without penalty.”

This is the only bill discussed in the article, so I don’t really know how that qualifies as “a wave,” but lol nonetheless. Also, dude named his son “Chart.” Not Hart, not Charles, but Chart.