Image: Kingdom of the Planet of the Apes, 20th Century Studios
This summer has been feast-or-famine at the theatrical box office while June’s high-powered TV lineup saved the small screen from the doldrums of May. But what is succeeding, what is failing, and what are the major players learning (or not learning) from it all? Let’s dive into an issue that specifically focuses on the strategies behind recent moves and how they reflect executive thinking at the decision-making and investment level.
1. It’s the End of the World As We Know It – Perhaps it’s because of the rash of elections across the globe, rising fears about artificial intelligence and digital surveillance, climate change and an avalanche of other issues, but audiences are captivated by the end of the world right now. Entertainment has always been an externalization of the national and international sub-conscious; a reflection of the mass mindset. In recent years, that reality has translated to a lot of stories about a bleak future for humanity. In the last 14 years, the number of dystopian movies has outpaced the growth of movies released. Between 2010 and 2024, the number of dystopian films doubled, while the total number of movies grew by 82%, according to Parrot Analytics’ Content Panorama.
This trend indicates a strong industry response to the growing audience interest in the end of the world. (Make of that what you will ¯\_(ツ)_/¯). The revived Planet of the Apes franchise, The Hunger Games, new entries in the Mad Max series, legacy sequels such as The Matrix Resurrections, the two-part Pacific
Rim series, the YA-focused Maze Runner and Divergent adaptations, new entries in the Resident Evil and The Purge franchises, etc. Most of the movies released in this genre since 2010 attract a predominantly male audience and appeal to both younger and older viewers, while 21% of dystopian films released before 2010 skewed female.
2.Warner Bros. Discovery Hates Discovery+ – Despite the fact that the success
of Discovery programming and the surprising high floor of Discovery+ as a standalone streamer helped grease the wheels for the eventual Warner Bros. takeover, David Zaslav and Co. seem intent to kill the streamer. Yes, we recognize that the merged Max is the company’s central focus and cost savings necessitate a reduction in other in-house D2C platforms. Yet not every consumer wants access to HBO programming at a higher price point even as Zas insists D+ will eventually be decommissioned. To expedite that goal, WBD has discontinued the streamer’s original documentaries/show tab, mostly stopped making linear shows available on the platform prior to their linear premiere, and often delayed the arrival of Discovery shows on Discovery+ until the full season is over. Since Q3 2022, Discovery+ has seen its library shrink by nearly 18%. Again, making Max the priority is the right strategy, but there’s something lost in brand affinity and perception by vehemently downsizing Discovery+. The aggressive approach makes it less likely that these subs transition over to Max
when the time comes.
3. Apple TV+ Needs Older Content for Younger Audiences – Of the eight premium SVOD services in the US, Apple TV+ skews the oldest with 49.5% of its audience in the 32-42+ age range. This is partially due to the streamer’s commitment to premium original programming – new dramas, comedies and thrillers that largely appeal to a slightly older demographic. As counter-programming to the younger-skewing competition, this can be an effective strategy point. However, as evidenced by Apple’s sub-scale subscriber base, it cannot be the foundation of a mass appeal streamer’s programming approach. Despite the oldest audience base, Apple TV+ leads all premium SVOD’s with the youngest catalog of content; 46% of its library debuted in the last 1-3 years. Again, this is because Apple relies almost exclusively on in-house originals versus library programming. Yet it is that older library programming – The Simpsons, The Office, Friends, Criminal Minds, Law & Order, etc. – that helps engage and retain audiences more frequently. To attract a younger audience and build out its demographic profile, Apple TV+ may need to invest in licensing older engagement-boosting fan-favorite programming.
4.The Hidden Strategy Behind Paramount+’s Price Hike – Paramount+ is raising its cost, creating a confusing jumble of plans and options. The ad-free (and terribly named) Paramount+ With Showtime is increasing by $1; the Paramount+ Essential Plan (with ads) is increasing by $2. However, annual plans are remaining the same as is the Essential plan if you subscribe by August 22nd. As such, this is less of an ARPU-centric revenue driver and more of a strategy to lock in customers for longer, reduce churn, and continue emphasizing the ad-supported tier. The hike in lower cost tiers also paints the streamer’s premium bundled tier as a better value. Audiences are savvier than ever thanks to the tidal wave of content they’ve swam through over the last eight years. But consumers still default to convenience, creating opportunity for streamers to confuse subscribers with a bevy of options leading them to the company’s desired target. It may be
effective, but not necessarily recommended.
5. MENA Audiences Lean Toward Arabic Streaming – Despite the relative health of linear TV internationally, MENA audiences are flocking to digital destinations. Thus far in 2024, streaming originals account for more than 40% of the total demand for TV shows in the region, surpassing the US market (36%). Specifically, local language content (as opposed to Hollywood exports) are gaining stream. Between Q1 2022 and Q2 2024, the demand share for Arabic language TV programming in the region grew from 6.4% to 20.6%. New content, or shows that released an episode in 2024, comprise 36.7% of the demand for Arabic TV in the MENA region. The increased volume has influenced viewer taste and, presumably, coincided with a rise in baseline quality. All of this suggests that investment in local language streaming originals should continue.
6. Co-Productions on the Rise – Netflix’s early years, in which it financed full production to secure global rights to a given title, may have skewed the public’s understanding of how TV shows get funded. For decades, co-productions have been a staple of the industry, especially internationally. But only recently have co-productions for US-based streaming services become more of a priority. For example, The Kissing Booth 2 (2020) and The Kissing Booth 3 (2021) were co-produced and released as part of Netflix’s collaboration with Amazon Studios in certain regions. Amazon’s Good Omens is a coproduction between the studio and BBC while the recently picked up and co-financed comedy Geek Girl, between Netflix and Canada’s Corus Entertainment, is another example. As content budgets stabilize and/or decline industry-wide, cost-effective production has become a necessity. This requires strategic partnership opportunities as well as a clear focus on specific territories and regions (versus always emphasizing global ownership). This subtle shift in American deal-making creates opportunities for international programmers to get a foothold in US productions (The CW is a good place to start as it plots out a future that blends live sports, unscripted programming, Canadian productions and international co-produced procedurals).
7. Movie Mayhem Insights – Thus far through 2024, Warner Bros. leads all studios in US box office market share at 21.32%, which equates to nearly $715 million in ticket sales. This should not be a major surprise as Warner Bros., as a distributor, is also responsible five of the 10 most in-demand films in the US from Jan. 1-June 22. However, what should be concerning for all of Hollywood is that of the 50 most in-demand films in the US year-to-date, 41 of them were not released in 2024. This speaks to the lack of fresh wide-release product in the marketplace this year as a result of 2023’s dual Hollywood strikes. A
common mantra that has emerged is “Survive ‘Til ‘25,” when the schedule is expected to somewhat stabilize. Yet there’s still ample room for a completed film to be moved up to the latter half of 2024. Audiences flock to movie theaters when there is a consistent cadence of attractive high-profile product. The stop-and start nature of theatrical cinema since 2020 has stunted momentum and prevented a rapid return to relative normalcy.
8. Netflix’s Immersive Entertainment Centers – Netflix’s existing pop-up entertainment and marketing events have satiated talent concerns about the streamer’s commitment to traditional promotion but haven’t made much of a dent in the company’s business strategy. Yet brick-and-mortar operations is now front-and-center for the digital diamond as it plans to open two in-person experience venues. Why the unexpected pivot? As old fashioned as in-person may be these days, such venues can contribute immensely to brand-building (as Disney theme parks, ESPN Zone, Universal Studios and other real-life efforts have in the past). The opportunity for strategic tie-ins of existing IP – whether that be video games connected to major titles or merchandise from the WWE – are endless. But the ability to develop, grow and cement a tangible connection with audiences that funnels across mediums is priceless. Will the young girl swept up in a real life Bridgerton venue or the lifelong Witcher fan walking through Novigrad be more likely to stay subscribed for longer (while forking over a premium for the in-person experience)? I think so.
One Fun Stat
•The quarterly percentage growth of new streaming original titles has dropped from 11% in Q1 2020 to just 4.6% in Q1 2024.
Five Key Reports to Check Out
1.Why Some Oscar-Winning Movies Make Money and Others Don’t
2.New TV Habits Call For New TV Metrics
3.Netflix’s Bridgerton Offers a Masterclass in Franchise Efficiency
