Oh, What A Tangled Stream We Weave

The holidays must be over, because the reaction to THE WALL STREET JOURNAL’s Sarah Krause lengthy diatribe about how riled up folks are about the cost and proliferation of streaming services got a lot of attention from many other outlets, including a whole bunch not hidden behind costly paywalls of their own.

As sister publication THE NEW YORK POST’s Alexandra Steigrad explained for the apparently growing percentage of thriftier folks among us:

Customers canceled their streaming subscriptions at a higher clip than last year as services like Disney+, Netflix and Hulu jacked up their prices, according to a report.

Defections across premium streamers rose 6.3% in November from 5.1% a year earlier, the Wall Street Journal reported Tuesday.

Actually, had Steigrad paid closer attention to the very graphic that accompanies her article, she might have also noted that a mere month before, in October 2022, the cancellation rate at “major streaming services”, defined in the detail provided by research firm Antenna as Weighted average based on the total subscriber counts of each service. Includes Apple TV+, Discovery+, Disney+, Hulu, Max, Netflix, Paramount+, Peacock, Starz. U.S. customers only. was an even lower 4.6%.  That’s a 38% shift over a 13-month period, for those keeping score.  An even more clickbaitable stat than the more mundane-sounding 24% year/year change that most media outlets picked up on.

Moreover, the news about the degree that those cancellations reflected those of “serial churners”, one which several research firms had identified during 2023, was even more striking:

Over the past two years, roughly 25% of those who subscribed to AppleTV+, Amazon’s PrimeVideo, Max, Peacock, Paramount+, Nettflix, Hulu and Disney+ have canceled at least three of those options – an increase from 15% before hikes pushed the combined tab of the ad-free monthly costs for those eight streamers to $112.42 a month.

And that’s especially notable given how much more these services will be relying on their ad-supported tiers to keep themselves more competitive.  Several have arranged unholy alliances via bundling options to try and stem the tide.  And there’s plenty of hopeful ancedotal examples offered of how effective some have been.  But as I’ve counseled countless overreactive executives who tend to live in bubbles for decades, anecdotes aren’t necessarily empirical evidence.  And sometimes, even what is offered up as empirical evidence needs additional scrutiny.

As most of these services are chasing the overall popularity of Netflix, a story from NEXT TV’s Jack Reid that also broke Tuesday also got a lot of attention.  Per Reid:

Time spent streaming movies and TV shows on Netflix in 2023 declined by more than 7 billion hours vs. 2022, based on data provided by Netflix’s own weekly “Global Top 10” ranker.

That’s an almost 17% year-over-year decrease in audience engagement — a far more significant chasm than what Next TV reported in June, when we crunched similar Netflix self-reported data and found a year-over-year viewing deficit of about 330 million hours, or 4%.

Daunting, to be sure.  Except, as our friend Rick Ellis of TOO MUCH TV.com observed in his newsletter last night, which he admits was written amidst some back-to-work crankiness, there were more asterisks attached to that headline than usual:

The comparison was made using data from Netflix’s weekly “Global Top 10” rankings. And as you might suspect, that is not exactly the most precise way to calculate total viewing data. Because while it’s true that the majority of viewing on any streamer is concentrated in the top titles, there’s no way to know what is going on outside of that top ten. And those differences can skew the year-on-year data to the point of being useless.

But there are bigger problems with the comparison, which NextTV admits in the article:

Around the time of our June report, Netflix tweaked its metrics, ranking shows based not on total engagement but on number of “views.” This skewed direct YoY comparisons, but the shows that wind up at the top of Netflix’s rankings are still those that command the most viewing hours.

So…it would be more accurate to have the headline read “Netflix Viewing Of Top Ten Shows Declined 17% In 2023″?

You bet.  But, yet again, not exactly to the level of “dog bites man”.

Because if one crunches the numbers of the data that VARIETY’s Michael Schneider released at year’s end on the declines of linear TV, there’s been double-digit declines seen in that world as well.

In 2023, the top ten linear cable networks averaged 1.065 million viewers, heavily weighted the only three that actually broke seven figures on their own– FOX News, ESPN and MSNBC.  That’s -11% below the 1.203 million 2022’s top ten averaged.  Several, including TNT, HGTV and, sorry to say, MSNBC, fell year/year at more precipitous rates.

Maybe Ellis was a bit too snarky, even for my tastes, with his outright castigation of Reid’s work.    The overall narrative of Netflix’s need to be concerned is still very much on point, especially in light of the reality check that the most immediate impact that serial churning has is the inconsistency on a month-to-month basis of exactly what defines a streamer’s universe, which is at least how old-fashioned spots and dots have been bought and sold against for decades.  All the more reason all of the scrambling and marketing partnerships are occurring.

Especially in light of the further reality check that at the end of this month Amazon Prime Video will default its 67 million subscribers to an ad-supported tier, giving it a massive advantage over the reported 15 million global subscribers currently capable of seeing Netflix with ads.  Prime’s challenge, of course, will be to actually have stuff on it worth watching that they can prove was indeed watched.  And even in decline, Netflix is still best-in-class in that world.

Where Ellis is spot on is his reminding that in a landscape where accurate interpretation of actual facts directly impacts Wall Street confidence and, indeed, JOBS, a somewhat more informed press is all the more needed in times like these.  And the company that actually dropped the initial headline-stirring subscriber research reminds that there is actually reason for optimism–assuming, of course, companies are willing and capable of actually fighting the necessary fight.  As Steigrad’s recap stressed:

Analytics firm Antenna said many customers who canceled service return to the streamers when there’s more appealing content available.  “Retention doesn’t just mean holding on to a new subscriber the first time they get them. It’s about managing a relationship over a true customer lifetime,” said Jonathan Carson, co-founder and chief executive of Antenna, which compiles data from third-party services on the streamers using information such as customers’ online purchases, bills and banking records.

Which means that, in the right context, anecdotal evidence such as that offered up by this high-value customer is worth at least using as an aspirational backdrop:

Brendan Byrne, a father of four in the Boston area, pays for streaming services including Netflix, the Disney bundle of Disney+, ESPN+ and Hulu, as well as Amazon Prime Video and Paramount+– on top of cable — but is starting to question the value of some of those subscriptions. 

After last year’s ‘Hollywood writers and actors strikes, “the lack of content is evident across all of these streaming things right now,” he told The Journal. ‘Hollywood writers and actors strikes, “the lack of content is evident across all of these streaming things right now,” he told The Journal. 

“We’ll cut back on a few of them,” Byrne said. “We’re just not using them.”

And if you’re Netflix, perhaps the story that should be of most concern was the one that referenced now-outdated Nielsen data that observed that the 23-week streak of SUITS reruns being in their top ten, regardless of what and how they specifically determine what constitutes that list, came to an end.  And the bad news about being dependent upon acquired content to be watched is once more popular stuff has been consumed, there’s hardly as great a demand for rewatching it.   You can, as Netflix touted, then go out and get the next best binge; per that Nielsen data, the recently-acquired YOUNG SHELDON is now popping up at the top of their lists.  (Nice magnanimous move on your part, Yosemite).

So my message, unlike those of media reporters’, is much, much simpler.  Go make some new shows worthy of our money and our willigness to sit through ads, Netflix.  Spend a little bit less time debating the likes of Jack Reid. And if y’all need a little help in attacking any of those issues, there’s more than enough of us out there to help you.

Until next time…



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