Cut-throat competition

Streaming and linear TV are increasingly converging

After a pandemic-related surge, enthusiasm among streaming providers is now more subdued.

(Bild: stock.adobe.com)

It will soon be five years since the pandemic forced people into lockdown and, as a side effect, triggered a huge global push in video streaming. Netflix and co. experienced fantastic growth rates in users and usage. However, the enthusiasm among providers is now more subdued.

This is because some players have not yet reached the profit zone. And the battle for programming - the best series and most popular films - is becoming more aggressive. Some program producers are also refusing to participate. Germany's most important auteur filmmaker Wim Wenders ("Paris, Texas"), for example: "I don't work with the streamers because they are too greedy for me, they keep all the rights," says the filmmaker to Deutsche Presse-Agentur. "What do they want to do with the content? After exploitation, they all go into a big vault and many are then dead for all time."

All fishing in the same pool
Cut-throat competition is spreading. "Everyone, whether broadcasters or streaming portals, now wants to show the same content and is looking for it here," explains Jens Richter, a member of the board of the London-based entertainment producer Fremantle, at the world's largest TV trade fair Mipcom in Cannes recently. As everyone is now fishing in the same pool, the boundaries are becoming increasingly blurred.

"Traditional broadcasters and streamers are converging more and more, Amazon or Netflix, for example, are now using advertising and showing live broadcasts, while TV broadcasters are focusing on their streaming offerings," says Richter. One example from his company is the show "Got Talent", which is available in a local version on the Italian Disney+ service. In Germany, it was shown as "Das Supertalent" on RTL. Brands are becoming more interchangeable.

TV stations are extending their brands
At the same time, TV stations are using well-known formats from their linear programs to achieve reach on their online platforms. Netflix is going its own way. Although the US company has already produced many successful series itself, the mother of all streaming services has never wanted to sell them to another provider - no one else in the industry does this. According to its latest annual report, Netflix is sitting on a total debt of 16 billion dollars (15.3 billion euros).

Netflix has been taking action against the sharing of passwords beyond a single household for several months. This is also driving growth in user numbers. Many previous free riders have taken out their own subscription instead of turning their backs on Netflix. Nevertheless, further commercial success will probably also go hand in hand with a move towards TV: "Streamers can only make a profit with advertising and trading customer data," says television scientist Lothar Mikos with certainty.

Co-existence
Conversely, traditional television, which continues to expand its streaming production, is still holding on to a large base. According to the latest moving image study, the TV sector is still clearly ahead in the overall target group with 77%. "The crash of TV predicted by many has not actually happened," said Thomas Gruber, chairman of the Teletest working group. "The picture that is emerging is one of a co-existence of TV content and online alternatives in which both sides could have found their place," said RTR Media Managing Director Wolfgang Struber.