Streaming exclusivity will hurt companies in the long term

The myriad streaming choices will also make accessing content much more complicated for viewers.

Remember when there was just Netflix and Hulu, and nobody cared about Hulu? Simpler times, those were. Now that entertainment and mass media companies have realized how lucrative online streaming is, these once-dominant services now have some serious competition. Well, competition incentivizes better, more cost-effective offerings from producers, so competition is good for consumers, right? In 99.9 percent of cases, I would say the answer is obviously yes.

By now, however, you can probably tell that this is one of those scenarios where that is not the case. In the streaming industry, competition is not about making your product better; it’s about making other products worse. Enter the exclusivity deal.

You can watch “The Office” on Netflix, but not on Hulu, because Netflix has paid NBC for the exclusive rights to stream the show online. In the industry’s infancy, when there were only two major legal streaming services, this was not such a big deal, and it allowed the two services to one-up each other with new offerings. Times have changed, however, and now every vaguely media-related company has its own streaming service either available or soon to be released (Netflix, Hulu, Amazon Prime, CBS All Access, ESPN+, Disney+, HBO Now, HBO Max, Peacock, Apple TV+, YouTube TV, NBC Sports Gold, et al.).

Naturally, since NBC will soon release its dedicated streaming service (Peacock), “The Office” will be available for streaming there and only there, otherwise NBC would have to admit that they have nothing unique worth buying an entire streaming service for. Because there is now a prolific number of streaming services, and each is segmenting off its own corner of the digital marketplace, a Netflix subscription is less valuable than it was ten years ago in terms of the content it includes. Netflix knows this; that’s probably why they’ll toss a few million bucks to any recently-graduated film studies major with a script written in crayon to produce an original series.

Before Netflix, there was piracy. It goes without saying that piracy is illegal. Peer-to-peer file sharing, torrent sites and other shady software can be used to access movies and TV shows online. When the internet was in its infancy, this was the easiest way to access online media, but there was a high probability of downloading a virus or malware. Because of the risk involved, when streaming services began to offer the same content for a monthly fee without the risk of being tricked into downloading something as sinister as McAfee antivirus, many stopped pirating and started streaming.

Now that it is harder to access content through streaming, this trend is reversing. The Institute for Information Law found that, in 2014, 83 percent of people in the U.K. accessed some type of streaming content legally and 38 percent accessed some type of streaming content illegally. In 2018, Variety found that some 60 percent of consumers had accessed content illegally. Although these used different survey methods (it was really hard to find two surveys of the same country, okay?), there is a clear and present increase in interest of piracy, especially when one considers that the Variety survey also found that 83 percent of pirates try to find legal channels to access the content first.

The streaming industry is tearing itself apart by focusing on short-term profit; people will follow the path of least resistance and once it becomes easier to pirate, people will pirate. Personally, though, I’m just going to be using my 10 different defunct emails and just getting a free trial whenever I want to watch something.

Post Author: Dominic Cingoranelli