Q1 revenue for media and tech companies is behind us, so it’s a good time to revisit how Netflix and the four most challenged – Amazon Prime Video, Disney +, Apple TV +, and HBO Max-put together and trending for the rest of 2021 Just 18 months ago, most of Netflix was playing alone. What a difference months for the reigning champ of these “flowing wars.” Today, Netflix faces giant competitors around the world as is every turn.
For our consumers, because streaming has become our activity of choice (always, our only activity!) In the last year of the world’s pandemic lockdown. While life during the COVID-19 pandemic was the worst times for most, it was the worst times for streamer trees. Everyone benefits from the causal forced adoption of the habit at first sight of sin. But COVID has only accelerated pre-pandemic trends that have meant the continued elimination of outdoor cinema behavior. Now the train has completely left the station, and it will never return – even if the world opens up and we open our doors. We value the choice, ease and economy of streaming very much.
Of course, we consumers still have our limits. We can’t stream all mega-players. We have limited income available, and we vote with our wallets. So which major streamers are most in a position to win, and how will they trend for the rest of 2021?
NETFLIX – Bearish Trend
First, the good news. Netflix remains the undisputed global leader among streamers with 207+ million paying subscribers. The bad news is that the red giant’s growth stopped in Q1. While Wall Street is expected to have about six million new subs, Netflix delivers fewer than four. The Netflix Bulls dismissed concerns about the “miss” as having no respect for the left. Netflix just pulled 2021 subscribers in 2020 because of our collective Covid lockdown. So, naturally the 2020 will lead to an early 2021 bust. Makes sense.
But not too fast. The Netflix Bears (yes, there are some) have long flagged the fact that the U.S. market is saturated and reliance on continued international hyper growth is facing its own significant hurdles-including various economies of territories ahead of mobile and localized competition. Netflix is now battling not only Amazon for global dominance, but also facing global challenges from Disney, Apple and HBO Max (and those are the top US players). Disney and Apple are two of the strongest brands on the planet, and Disney and HBO Max both boast franchises on the inside that Netflix can’t.
And while Netflix only lives with subscribers, Netflix’s four main competitors are using their streaming service as marketing for even more machines. Amazon pays for our purchases, Apple does the hardware, HBO Max does the AT&T wireless plans, and Disney does the global theme park and marketing.
Netflix really isn’t going anywhere. But for the first time, the Wall Street Bears will come out of the woods. Netflix will have to change its business – like all of its many competitors – or face being swallowed up by one of them. Netflix only expects to add a million new subs worldwide in Q2, and say in the next few quarters.
AMAZON PRIME VIDEO – Bullish Trend
The Bulls are in force behind Amazon Prime Video. It’s hard not to feel confident about a service that is played by completely different rules of the game and doesn’t feel compelled to succeed on its own. While Netflix needs to make money from its streaming service to survive, Amazon Prime Video can justify its existence by acting as a marketplace to attract us, buy more, and feel better about the giant that seems to be touched by every aspect of our daily lives.
Amazon Prime Video is a powerful force in the world, with over 200 million paid subs, 175+ million of which streamed to movies and television last year. And now, for the first time, it’s open to Amazon’s challenge to Netflix to spend on content. Amazon spent $ 11 billion on revenue in 2020, just behind Netflix’s $ 11.8 billion last year (Netflix plans to spend $ 17 billion this year). CEO Jeff Bezos is clearly raising his ante, and Netflix’s Reed Hastings needs to do the same if he wants to continue.
DISNEY + – Bullish Trend
Not less than 18 short months, Disney + Achieved what some thought possible – crossed the 100 million subscriber fee count (about half of Netflix). And the Disney pack is a 1-2 punch unmatched by Netflix or Amazon.
First, Disney is a worldwide brand that has practically planted our DNA. Disney taught us as kids, and we were happy to pass that on to us. Second, the entire Disney franchise and interior design has experienced everyone. There is the Marvel universe, Star Wars, and Pixar, and don’t forget Disney Princesses and new Avengers and Avatar franchise that came in good faith with Fox. That’s a treasure trove of evergreen content that we and our kids will always watch – and Disney may continue to mine for future gold subscriptions.
Most still don’t understand that Disney + is just getting started. In a galaxy not too far away, we see Disney + for what it really is – the gateway to Disney’s entire Magic Kingdom, where different subscribers with recipients receive different tiered benefits (monthly park offers theme, lots of toys for our kids, etc.). Disney + marks a fundamental shift in Disney’s business model from a single transaction to recurring revenue on an Amazon Prime.
Plus, let’s not forget the long -standing annoyance with Netflix Hulu about the Disney family. Mouse House plans to aggressively expand it internationally this year under the “Star” banner.
APPLE TV + – Neutral
Apple TV + not terribly interesting to most of Hollywood. There continues to be some concern over the compelling original program compared to other giants. But CEO Tim Cook has been at it for a long time. Imitation is the highest flattery of these streaming wars, and Apple – like Disney – ripped a page from Amazon’s Main playbook and put Apple TV + inside it. Apple A subscription bundle. Like Disney +, the Apple One is still in its early stages.
Apple tops the $ 2 trillion estimate today despite relatively anemic revenue growth over the past several years (even if the most recent quarter was a blockbuster), because investors want the fact that the Apple One recurring revenue adding shares. Apple TV + has the same marketing role for Apple that Amazon Prime Video plays for Amazon – it uses the content as marketing to attract us and keep us there. The interior is “friendly” and warm. The hardware is cooler. That’s why Apple just announced a major expansion of LA studios to get rid of many of the originals.
Apple can, and will do, much of its international presence to challenge Netflix and others on every channel.
HBO MAX – Bullish Trend
Slow to exit the gates, AT & T’s HBO Max rapid steam extraction and is now approaching 50 million paid subs. Its trick to get things back on track? The pandemic was used to do what it wanted to do (and other studios) in the long run – release the entire slate of film for in -home streaming on day 1, breaking down decades of theaters in theater in process.
Yes, many in Hollywood are mocking the decision of new studio Jason Kilar. But investors are happy with what they believe is inevitable. Even if HBO Max retreats somewhat in 2022, the new 1 -star power day – Wonder Woman 1984; Godzilla vs. Kong – catapulted HBO Max back into the conversation as a true streaming contender.
A new international world awaits HBO Max, full of world franchises that are second only to those on Disney’s list. The streamer plans to cover 60 new territories.
The epic premium streaming battle is here. The knives came out. And the Fearsome Foursome wants to impose 1,000 cuts on the reigning champ. As they say in the movies (specifically, Jeff Goldblum’s The Earth), “Fear. Don’t be afraid.”
Peter Csathy is the Founder and chairman of CREATV Media (“Creative Media”) and CREATV University (“Creative U”). Subscribe to his FEARFUL MEDIA podcast, sign up for his newsletter, or follow his YouTube channel. He is too tweets.