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Streaming mergers can impact viewers positively and negatively, potentially creating new shows and movies while eliminating others. Mergers and acquisitions are increasingly common in today's film industry as studios race to compete in the streaming market. Are these big studio purchases a good or bad thing for viewers?

Why Streaming Mergers Are Happening

Streaming mergers occur when two digital media companies combine, usually through the sale of a smaller company to a larger one. Studios have merged and broken up throughout the history of Hollywood. Over the past few years, though, mergers and acquisitions have become more common and stirred up debate.

Disney is at the heart of this trend. Over the past two decades, Disney has acquired some of the biggest names in entertainment, including Pixar, Marvel and Lucasfilm. So, when Disney entered the streaming market to compete with Netflix, it became a near-unstoppable powerhouse.

Streaming is a desirable model for film studios because it allows them to cut out middlemen and deliver content directly to viewers. When Netflix proved the success of this model, other studios and media companies in the industry attempted to replicate that success.

As of 2023, the biggest streaming services by subscribers are Netflix, Disney+ and Amazon Prime Video. There's a sharp falloff in subscribers for the many other much smaller streaming services. This can be an issue since streaming content is expensive to produce. Smaller studios and streaming services may be forced to merge to pool their resources and compete with titans like Disney and Netflix.

How Streaming Mergers Can Be Good for Viewers

Streaming mergers are a symptom of the competitive streaming industry, which means they're neither completely good nor bad. Mergers can result in better content for viewers, including projects that wouldn't have otherwise been possible.

A great example of this is the "Percy Jackson" series coming to Disney+ in 2024. In 2010, Fox adapted the massively popular fantasy series into a movie that received mixed reviews. When Disney acquired Fox in 2019, they got the rights to "Percy Jackson," among many other properties. This allowed Disney to take a shot at adapting Rick Riordan's books as a streaming series.

Mergers also allow smaller studios to continue growing using a larger company's resources. Studios and streaming companies aren't always sold because they are underperforming. Sometimes, a business sells because it is doing so well that a larger company wants to support it. Selling a business can take 6 to 12 months on average, so this type of merger usually makes headlines online before finally going through.

A great example of a positive merger is Pixar. While it isn't a streaming company, Pixar was purchased by Disney at the height of its success. Disney was originally a distributor for Pixar's films under a temporary deal. Bob Iger, Disney's CEO at the time, loved Pixar's content so much, he was able to convince Steve Jobs to sell the company in 2006. Now Pixar is a beloved pillar of Disney.

Mergers can also pool multiple streaming services' content into one platform. This helps reduce the number of streaming services viewers have to pay for to watch what they want. For example, Warner Bros. announced in April 2023 that they would be merging Discovery+ and HBO Max into a single service, which launched in May 2023.

Drawbacks of Streaming Mergers

Unfortunately, streaming mergers can do more harm than good for some viewers. Any time companies merge, it reduces the number of choices consumers have. Mergers may force viewers to pay more for one service just to watch a single show they like.

With streaming services controlling so much of the entertainment industry today, mergers can result in less diversity in the type of content that's coming out. They can also spread subscribers thin, resulting in less revenue and more competition between streamers.

Disney "purged" dozens of shows and movies from Disney+ in May 2023 because they weren't generating enough revenue. Warner Bros. also axed the "Batgirl" movie in 2022 without even releasing it. Netflix is now infamous for canceling shows after only three seasons. All of these situations are the result of peak competition between a few big streamers that are straining the market.

Mergers also reduce jobs in the entertainment industry. Usually, the larger company will let go of many of the smaller company's employees during an acquisition. For people who are new to the industry, there are fewer potential places to start a career. Directors, actors and writers also have fewer studios to choose from when shopping around a new script or project. Fewer people working in entertainment reduces sources of new ideas and cuts out people who could be highly talented but never get a shot. T

The result is lower-quality, less diverse shows and movies for viewers.

The Long-Term Impact of Streaming Mergers

Streaming was supposed to end demand for cable TV, but it's beginning to look more and more like cable. Mergers are compiling many studios' content onto hub platforms that function similarly to cable services. All the big platforms even have ad-supported pricing tiers now.

Streaming services' prices are also going up as a few big market leaders compete with each other. Over the next few years, mergers could create a streaming industry that's simply an expensive recreation of cable, for better or worse.

The post How Do Streaming Mergers Impact the Viewer Experience? appeared first on The Solid Signal Blog.

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