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Netflix introduced ads and now Amazon Prime too. It’s your fault.
It’s a three-act drama
In act one it’s about growth — extravagent, out-of-control, venture-funded growth — you remember that. Piling on millions — hundreds of millions — of users as quickly as possible. And in this act the product improves. It has to. Features are added with no concern for cost — bigger libraries, 4K and HDR video, better sound. Data centres blossom everywhere, faster networks eliminate latency, improve the experience. Distribution partners are falling over themselves to sign up, production budgets are lavish — insane, in fact (how about $58M per episode?). This is how you acquire a big audience and a chunky annuity income fast.
In act two it’s crisis. Cheap money is over, we’re told, capital is withdrawn, invested elsewhere, exit horizons shorten. Services collapse or are quietly closed. Even the biggest corporations — the heroes of previous eras — admit defeat: their shabby content libraries and derivative branding weren’t up to the job. And the sheer profusion of competing services with impenetrable offers and stupid names was bound to produce a shake-out. Carnage.
Act three brings resolution — consolidation. Services are merged, prices increased and catalogues simplified. And…
