Film Production Company Cord Cutting:  Media’s 2019 Challenge

The amazing success of Netflix from over a decade is notable which makes other companies wish to achieve. David Zaslav, Discovery Inc. (Discovery Channel) CEO promised a new streaming outlet that’ll bring oversea markets and aim to become a similar Netflix platform for golf. Fans of Fox Channel also are to enjoy the same streaming programs launched by 21st Century Fox they called Fox Nation.

Even though it’s an impetus for a few, glitzy service, the melancholy problem isn’t something new. Whenever the media company work to build another connection thru broadband streaming, they are to continue losing links for consumers through.

According to data from Kagan, market research firm part of S&P Global Market Intelligence, this type of scenario is called the “cord cutting” becoming critical. Around 726,000 subscribers of satellite broadcasting, industry’s worst quarter record. With the combination of cable and telecoms, the sector lost about 1.2 million subscribers in three years until September 30 last year. This year, according to the analysts at Pivotal Research, will be a continued consumer loss “at a similar pace to ’17 and ’18 as consumers continue to rebel against the rising price of PayTV amidst the continued emergence of cheap entertainment alternatives.”

New customers of broadband servicing including Sling TV, DirectTV Now, PlayStation Vue, Hulu, and Youtube might have moderated. According to Kagan, the services gained around 2.1 million new subscribers in last year. At the same time, traditional outlets lost around 2.8 million subscribers.

To be able to adapt in the shortage of subscribers, the industry is creating various Netflixes – in a speed.

Tim Hanlon, CEO of Vetere Group who consults media and marketing companies also said, “consumers have much more flexibility to pick and choose the things they want to subscribe to, and I think that is going to be more attractive to a greater majority of people than a traditional pay TV company giving them a handful of restrictive bundles to choose from.” He also added “most programmers need to gently land their pay TV model while greatly ramping up their direct-to-consumer offerings. That is the dance that most television managers need to do over the next five-plus years – manage the decline of the bundle and shift to the expertise of being a direct-to-consumer proposition.”

Customer declines somehow are prompt by the distributors/providers themselves. Various video carriers including AT&T also choose to be out of the business, holding on to low-profit subscribers and those who only sign up whenever there’s another season of their favorite series or movies and then quickly leave. Bruce Leichtman, industry consultant then cautions the sector saying “net losses [in subscribers] is not necessarily the same thing as cord cutting.”

It is clear now that the industry is trying to overpass the traditional business. During 2018, Walt Disney launched ESPN+, subscription streaming outlet for sports fans, providing them new games coverage and programs that won’t be able to see on any cable network. Within five months of its outlet’s operation, Disney gains more than 1 million paying subscribers (until September last year).

For this year (2019), media companies are to bet more on streaming. AT&T now plans to uncover subscription-based offers and promo using WarnerMedia content and with three varying pricing bundles. On the side of Disney, their grand hopes for Disney+ is a subscription service featuring programs from their Disney, Pixar, Star Wars and Marvel. On CBS, they are placing additional emphasis on their “CBS All Access” streaming outlet. AMC Networks then got Shudder, a streaming service having more focus on horror films.

Picture a new world when TV fans then choose to avail their primetime entertainment from Disney, Amazon, Netflix, Hulu or WarnerMedia instead of CBS, NBC and ABC. But still, that isn’t guaranteed as the future scenario.

TV outlets might not survive such changes. Exquire, Chiller, Cloo, and Style, NBCUniversal’s cable networks in years are not afraid to shut down. Viacom heads to negotiation with Charter Communications regarding the placement of their networks on pricing. Discovery is composed to re-operate its small cable outlets to showcase programs by Chip and Joanna Gaines, home renovators.