Streaming Service vs. Streaming Service vs. Cable

by Aanika Patel

Since Netflix’s announcement in 2007 to launch an online streaming service, the way we view content and the media and entertainment industry has been changed. Now almost 61% of young adults watch TV through streaming services and Netflix accounts for 15% of the world’s internet traffic. We as a society are predicted to shift even further away from the traditional evenings spent around a cable-enabled TV and are more likely to be streaming or casting something on to our screens instead.

Everyone wants to get in on the world of streaming. Disney announced last year that it will be entering the streaming business with its own platform in 2019 and pulling all Disney content from Netflix. With its massive library of intellectual property and an extremely loyal following when it comes to family movies in particular, another streaming service just became a must-have. This stacks up on top of other popular platforms such as Hulu, Amazon Prime, HBO, Showtime, CBS All-Access, and more. Every network wants to have its own streaming service.

But at what point do streaming platforms become the very problem they were trying to solve?

The excitement and ingenuity of Netflix and Hulu when they launched in the early naughts came from having the content you love on-demand and at a more affordable price than buying cable. You may not be able to access live programming such as sporting events or award shows but you had a large library that was worth the price of under $10 or $15 a month.

In preparation for Disney pulling its library and a commitment to building more original content, Netflix raised subscription prices again this year and there are rumors that other streamlining services aren’t far behind. While there are still many users who maintain both a cable and multiple streaming services, the total bill for a mix of streaming services is approaching what it would be to just maintain a standard cable account and potentially rent or pay for movies on an ad hoc basis.

Cable companies have tried to respond to the growing trend away from traditional cable and towards streaming. Almost cable provider has its own on-demand app that contains a library of titles you can stream on demand – some of which may soon have some of the high-value content that is being pulled from Netflix due to deal structures between cable providers and media companies. These providers also have the added benefit of a large library of live TV and greater flexibility in recent years to great a more customized channel mix when selecting a cable package.

As streaming services begin to break off from Netflix and Hulu-like disruptors, we as consumers will be forced to decide how much of our wallets we want to pay for these bundles or if the traditional cable package has become attractive once again. Streaming services will need to pay careful attention about the unique content mix they acquire and how their competitive strategy may be shifting more towards keeping viewers from returning to cable rather than acquiring them from traditionally cable-centric viewers