Another 1.2 Million Consumers Ditched Traditional Cable TV Last Quarter
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Surprising nobody, the traditional cable TV industry lost another 1.2 million paying subscribers last quarter as users flee to other alternatives. Largely those alternatives consist of streaming video services that are cheaper, more flexible, and feature better customer service. Many others are rediscovering free over the air broadcasts. Others have simply shifted away from TV entirely, choosing to embrace YouTube or TikTok.According to Leichtman Research, the top cable companies lost 587,649 customers in just the last quarter, compared to 698,000 for telco and satellite providers. Over the last year, traditional pay TV providers saw a net loss of about 4,520,000 subscribers, compared to a loss of about 5,460,000 over the year prior (impressive for a trend that the industry spent years pretending wasn't actually happening). Fortunately for the industry, the cord cutting revolution appears to be slowing somewhat:"Pay-TV net losses of 1,230,000 in 2Q 2021 were about 275,000 fewer than in 2Q 2020 on a pro forma basis, said Bruce Leichtman, president and principal analyst for Leichtman Research Group, Inc. Over the past year, top pay-TV providers had a net loss of about 4,520,000 subscribers, compared to a loss of about 5,460,000 over the prior year." While the rate of decline is slowing there's still a lot of room to fall. The top traditional pay TV providers still serve roughly 77.6 million subscribers in the US, many of which stick around thanks to sports programming. As sports increasingly shifts away from traditional cable providers and toward streaming alternatives you can expect subscriber counts to follow suit.Users continue to flee traditional cable for the usual reasons: high prices, terrible customer service, and bloated and inflexible cable channel bundles. There continues to be some headway in these arena by entrenched cable TV providers, but there's a contingent of execs that simply refuse to seriously compete on price. In large part because many of these companies (Comcast) enjoy regional monopolies over broadband access, allowing them to squeeze those subscribers tighter than ever with bizarre fees and broadband usage caps and surcharges.Meanwhile increased competition in the streaming TV space has also made things a bit rougher on sector leader Netflix as well, which has been bleeding subscribers in both the US and Canada thanks to growing new entrants like Disney Plus. All in all the shift away from dominant cable TV providers toward more flexible, cheaper alternatives and actual competition (instead of the "wink wink, nod nod" non-price competition we saw between satellite TV and traditional cable TV for years) continues to be a great thing.
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posted at: 12:00am on 31-Aug-2021
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Netflix's Announced 'Video Game Streaming' Foray Fizzles Into Some Mobile Games Using Netflix IP
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You may recall that my colleague Karl Bode discussed Netflix's response to real competition last month, dealing mostly with how Netflix has attempted to hand-waive concerns over losing subscribers in the face of increasing streaming options from the likes of Amazon, Disney, and Comcast. But buried down in the last paragraph was a reference to Netflix's reported interest in video game streaming. Reports indicated that Netflix had hired an executive that had previously worked for EA, speculating that the company was getting into game publishing. There was no official word from Netflix as to what this game studio would actually look like, and the speculation was roughly what you would expect.While Netflix has not yet confirmed what shape its video game publishing arm might take, Bloomberg reporter Mark Gurman has suggested that the effort could lead to "video games [as part of] its service in the next year." The use of "video games" as a descriptor is key, as that differentiates the effort from the "choose your own adventure" TV specials that have become more common on the service since Black Mirror's "Bandersnatch" special debuted in 2018. A tantalizing thought, to be sure. Would Netflix, the company that largely changed the way the public consumes television and movie content, jump into video game streaming in some way to compete with Amazon, Google Prime, and the like? Given the lackluster adoption of such video game streaming services, and given Netflix's reputation for redefining content via streamed services, such speculation certainly made sense.But, no, Netflix is not getting into that sort of video game streaming service. Instead, the studio will build mobile gaming apps available to Netflix subscribers, chiefly utilizing Netflix intellectual property.One month after its vague announcement of a new gaming-centric strategy, Netflix has explained how it will "publish" video games in the foreseeable future: as downloadable smartphone apps, available exclusively for paying video-streaming subscribers.The news coincides with the company's public launch of Netflix Gaming on Thursday as part of the service's smartphone app... but only in Poland—and only on Android. The company's American Twitter translated Thursday's Polish announcement, which explains how the service works. It also announced the two games launching as part of the service today: Stranger Things 3, a 16-bit beat-'em-up that was previously available as a standalone Google Play purchase (and is still live on PC and consoles); and Stranger Things: 1984, a rebranding of a 2017 smartphone-exclusive game that revolve around slow, puzzle-solving movement through pixelated TV-series environments. Yawn. The more detailed announcement is honestly underwhelming. On top of that, the way Netflix is attempting to silo this new gaming content behind the Netflix app for subscribers sounds like an absolute user experience nightmare.To access this content, you'll need to log in to Netflix's Android app while using a Polish IP address, then open the region's new "N Gaming" row of icons (pictured below). From there, pick either of those games, and the app will direct you to their Google Play download listings. Once downloaded, the apps in question will request your Netflix credentials before loading, and they will not work without an active Netflix membership. The Polish IP part of this equation is a function of this all being in beta, so we'll leave that aside. But accessing the Google Play store by first navigating a complicated menu in the Netflix app... only to then have to re-input your user name and password for Netflix into the game application? Come on now, this isn't the efficient user experience Netflix made its name on.And I'm also terribly confused why Netflix would even want to restrict selling its games only to Netflix subscribers. Why not sell to, you know, everyone? This reeks of console exclusivity, where gaming console companies strike deals with developers to only appear on their consoles as a way to drive more console sales. Is Netflix's strategy really to use these mobile games to drive more people to subscribe or stay subscribed to its main offering?If so, it's a terribly weak move, and unlikely to work. Maybe the game catalogue will grow, but I can't imagine anyone considering unsubscribing to Netflix changing their minds simply to play a Stranger Things mobile game.
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posted at: 12:00am on 31-Aug-2021
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