Too Much TV: Your TV Talking Points For Wednesday, October 11th, 2023

It's not easy being right

Here's everything you need to know about the world of television for Wednesday, October 11th, 2023. 

THEY PROBABLY DO KNOW WHAT YOU'RE WATCHING...AND BUYING
One of the reasons why this newsletter is on Substack is that the company is constantly rolling out new features, many of them designed to build a deeper connection between writers and their audiences.

One recent addition is a simple one at first glance. They added a section for people who have opted to upgrade to a paid subscription to include some thoughts about why they made the decision. And from my perspective, it's incredibly helpful because it provides a window into what subscribers find useful about TooMuchTV. I receive a lot of email feedback but that just comes from a small subset of subscribers. Knowing why someone decides to pay for this newsletter helps guide me because if you're willing to pay for something, that is a pretty strong indicator of customer value.

And while I haven't kept a formal tally of the comments, I would estimate that somewhere around 75% of the feedback I receive is some variation of "I appreciate you have a different perspective" or "I like that you're not afraid to push against conventional wisdom." And to be honest, that is roughly my mission statement for this newsletter. I'm not trying to be one of the industry trades. I don't have to keep advertisers happy or worry that if I say the wrong thing, I won't be able to book guests for my next expensive industry event. Some of my proudest moments this year were when I would hear from striking WGA members telling me that they disagreed with some of my arguments. But they appreciated that I was fair and tried to look beyond the easy headline.

All of this is a long-winded way of explaining why I am highlighting a piece that was the cover story in the latest issue of The Hollywood Reporter. Hollywood Faces 5 Crises is the work of 7 bylined THR reporters and they are certainly all talented journalists. But the piece is filled with an annoying grab-bag of easy takes and half-hearted arguments that feel as if they were just ported over from the company Slack channel. To be fair, much of it is a reflection of what you'd hear from many people in the business. But that doesn't mean they are right. You can be a talented showrunner and not understand the business model of a large streamer. You can be a talented director and still have trouble seeing the business through anything other than a lens dated “2004.”

I could waste a lot of energy fisking the entire piece paragraph-by-paragraph. But let's focus on the streaming part (written by Alex Weprin), which was so infuriating to read that I actually walked away from my computer and took a break from the internet for awhile after reading it. I've added a couple of thoughts in bold throughout the excerpt:

It also raises an interesting question: Can streaming even work as a business model? 

<AAArgh! This is not a question. Yes, of course streaming can work as a business model. It can't work in the same way as linear TV, which was able to use a closed ecosystem and no viable customer options to create the type of return you generally only see if you're offering payday loans. But streaming is a fine business. Expecting it - or any other media business - to generate linear TV margins is just nuts>

Speaking to investors and analysts Sept. 19 at Walt Disney World, Walt Disney CEO Bob Iger argued that indeed it could. When Iger laid out four key priorities for his company, making its streaming business profitable was at the top of the list. 

“The company plans to make less content and spend less on what it does make, though getting key franchises like Star Wars back in theaters is a priority,” wrote JPMorgan analyst Phil Cusick in a Sept. 20 note, adding that he expects Disney+ to turn a profit by the end of fiscal 2024.

<It's worth noting that according to several outside estimates, Disney content spend for next year will be less. But primarily because it is spending less on some global sports rights and cutting back on new originals in some emerging markets. Which is not all the same as the blanket "spending less">

A top streaming executive tells THR that they believe profitability will come, led by advertising, and from getting “the value proposition right.” Many services launched at low prices to lure as many subscribers as possible as quickly as possible. That’s changing, and not only are the prices rising, but they are increasing in a way designed to drive subscribers to ad tiers, where these companies can further monetize users.

<Just on a side note, while I have no idea where that quote came from, it certainly sounds as if it came from a Warner Bros. Discovery executive, given that company executives continue to believe customers aren't paying enough in subscriber fees>

There’s a reason that Netflix and Disney+ adjusted their prices to make it more expensive to avoid ads, and there’s a reason Amazon is adding advertisements to Prime Video. They want consumers on those ad tiers (or to pay dearly for the privilege of opting out). Turns out, streaming is hard, but advertising remains a good business to be in.

<To be kind, I'll just say that these three companies are making decisions for very different strategic reasons. Netflix is more concerned with the ad market outside the U.S. In large part because they believe it will help increase the average revenue per user (ARPU) in countries where the monthly subscriber fee is relatively low. They have downplayed the impact of the ad-supported tier in the U.S. And in fact, its implementation has been slowed because the majority of American subscribers seem to value the content enough to pay the price to watch ad-free.

The Disney+ decision seems to be driven by a couple of factors. There are some global implications, but it's also an effort to rejigger their Disney bundle in advance of spinning off ESPN+ into whatever direct-to-consumer streaming product they eventually roll out. As I wrote about last month, Amazon is rolling out an ad-supported tier of Prime Video in large part because it provides a back-door way to raise subscription prices for Prime Video independent of raising the overall Amazon Prime subscription fee>

There are a few encouraging signs that streaming can be profitable, if not quite as lucrative as the cable TV business model it replaces. 

Netflix’s profits continue to grow, and for the first time a mainstream service from a legacy media company should turn a profit. Max, the service from WBD, was just about to break even in Q2, and it’s on track to turn a profit this year, CEO David Zaslav told investors during the company’s most recent earnings call.

WBD, of course, was particularly aggressive about slashing costs last year, including removing TV shows and films from the service to avoid paying for shows with little traction. 

If the other legacy media companies are a year or so behind WBD, that tracks. Peacock and Paramount+ are aiming for breakeven by the end of next year, as is Disney+, though the impact of the strikes — as a help or a hindrance to this goal — remains to be seen.

<Or...here's a crazy thought. It takes a few years for any mass-market business to start generating positive cash flow. In July, I wrote a stand-alone piece about streaming video revenue and the innovator's dilemma, which parse out the conflicting needs to not lose money while still managing to build a new business model from scratch:

What these media executives either didn't understand or underestimated was the challenging and steep curve of streaming video's technology life-cycle (TLC). Think of any successful technology as looking like an "S" or a bell curve. Building the business requires a huge capital investment on the front side of the curve. That often means substantial losses and the prospects of failure are high. But if you execute successfully, the TLC matures. Investment costs drop, profits rise and the resources needed to continue to grow the business decline substantially.

You can't build a new business without a great deal of financial pain. And that's not one or two-quarters of losses. That means deciding that if it requires torching existing business models to get there, you believe in this idea enough that you are willing to gamble everything in pursuit of success.

This retrenching we are seeing now in the streaming video business is the result of several intertwined causes. The high costs of mergers - both the Warner Bros. Discovery and the ill-advised recombining of Viacom and Paramount - left those companies more focused on servicing debt and keeping Wall Street happy than gambling on an uncertain future. And streaming video hasn't had the articulate leader it needs to convince investors and those working in the business that there is no other choice for anyone who is hoping to keep Hollywood profitable and innovative in the long run.>

And then there’s the Charter Spectrum wild card: If the cable giant is successful in bundling together all the entertainment streaming services, as it’s doing with Disney+, the legacy companies might just be able to find their way to profitability the old-fashioned way: by letting a cable company sell it all together.

<This is not at all what the Charter Spectrum deal is doing. It's not creating a "new bundle." And even if it was, this new-fangled bundle would have the margins of a streaming business, not the legacy cable model>

Some of the most popular shows on streaming are from the late 1990s and early 2000s anyway (Friends, Grey’s Anatomy, The Office). Why not bring back the business model, too?

<Please, tell me how you plan on doing that. "Bring back the business model" is one of those optimistically vague things people in the TV industry say, such as "we plan to make fewer things, but the quality will be higher" or "we'll fix it in post." The whole point of this exercise is that the old linear business model is slowly disappearing. Streaming isn't the cause of the decline. It's a consequence of it.">

I'm not even going to get into Leslie Goldberg and and Lacey Rose's Peak TV Is Over treatise. I'll just point you to my piece about the "Myth Of Peak TV" from last Wednesday's newsletter.

And as far as the other three "crises" outlined in the piece, I'll be charitable and say that they certainly are safe proclamations.

As in industry, we can't make the right decisions for the future if we can't even comes to an agreement on scope of today's issues. This flaccid piece from The Hollywood Reporter certainly doesn’t help clarify anything. Except for the inability of some journalists to move beyond the conventional wisdom.

ODDS AND SODS
* The animated family action comedy Merry Little Batman will premiere December 8th on Prime Video.

* I think it's fair to say that Tyler Perry is a polarizing figure inside Hollywood. But it's hard to find a more rags-to-riches story that his, and this Bloomberg piece does a nice job of providing an overview of his life. 

* Why aren't LP Bars a thing in the U.S.?

* South Park: Joining The Panderverse debuts October 27th on Paramount+.

* Former CBS TV scheduler Jim McKairnes has a piece on Medium that looks back at the history of US TV network scheduling and it is cat nip for classic TV fans.

* I'm a bit late to this one, but this podcast in which Rainn Wilson discusses spirituality is quite....deep.

* When Paramount+ pulled the sadly underrated animated series Star Trek: Prodigy a few months back, I predicted it was likely headed to Netflix. And so it is, with both season one and the unaired season two being licensed off for what I sure will be a much kinder fate.

WHAT'S NEW TODAY AND TOMORROW:

WEDNESDAY, OCTOBER 11TH:
* Awareness (Prime Video)
* Big Vape: The Rise And Fall Of Juul (Netflix)
* 4EVER Series Premiere (Disney+)
* Ghost Adventures Season Premiere (Discovery)
* Ghost Adventures: Screening Room (Discovery)
* Island Of The Sea Wolves (Netflix)
* Messi Meets America (Apple TV+)
* Nada Series Premiere (Hulu)
* Once Upon A Star (Netflix)
* Pact Of Silence Series Premiere (Netflix)
* The Cage Series Premiere (Netflix)
* The Greatest Show Never Made (Prime Video)

THURSDAY, OCTOBER 12TH, 2023:
* Code Blue Murder (Britbox)
* Coming Home (PBS)
* Doom Patrol (Max)
* Dr. STONE New World [dubbed and subtitled] (Crunchyroll)
* Fboy Island Season Premiere (The CW)
* Frankelda's Book Of Spooks Series Premiere (Max)
* Frasier Series Premiere (Paramount+) 
* Good Night World (Netflix)
* House Of Villains Series Premiere (Bravo/E!/Syfy/USA)
* In My Mother's Skin (Prime Video)
* Keke Wyatt’s World Series Premiere (WE tv)
* LEGO Ninjago: Dragons Rising (Netflix)
* Little Bird Series Premiere (PBS)
* Monster Inside: America's Most Extreme Haunted House (Hulu)
* Mud, Sweat and Tears: Premiership Rugby Series Premiere (Prime Video)
* Secrets At The Museum (LMN)
* Superbuns Series Premiere (Peacock)
* The Fall Of The House Of Usher Series Premiere (Netflix)
* The Nutty Boy (Netflix)
* Transplant Season Premiere (NBC)
* True Crime Story: Citizen Detective (Sundance Now)
* Wake (BET+)

Click Here to see the list of all of the upcoming premiere dates for the next few months.

SEE YOU THURSDAY!

If you have any feedback, send it along to Rick@AllYourScreens.com and follow me on Twitter @aysrick.