Analyst Ben Bajarin;

The full episode release of the season gave the impression of it being a great movie broken up into episodes that could be consumed in my own time — all at once or over time. This model allows writers to do more than they could in a movie given the time constraint. I’d even offer the viewpoint that this model allows for better storytelling overall. Which is why the glimpse we are seeing from Netflix is the future of entertainment — storytelling as a service.

I like the idea of ‘Storytelling as a service.’ That’s a great way to describe the shift to over the top services like Netflix.

I disagree that allows for ‘better’ storytelling. Limitations can be frustrating and challenging, but they can also force you to focus. I find much of the current wave of shows to be ‘fat’, containing content that doesn’t add to the quality just the quantity.

I like that all episodes can be released at once, but releasing over time has it’s strengths too; it builds suspense and allows for social interaction to develop as the story unfolds.

TV networks are, in my opinion and analysis, not well positioned for this shift given their business model. Due to their advertising focus, they are incentivized to release content over long periods of time due to how they structure ad deals. Netflix, HBO, and Amazon are not subsidizing these shows by ads but by my consumer dollars, so I’m paying for these stories as a service. Which allows for this favorable model consumers prefer of releasing all at once. The challenge, as I see it, is their need to keep the stories coming. If I’m paying for it then I always want something to be on. The thing I dislike the most about binge-watching a series is when it is over. After you finish a series or season in a weekend, we need/want something else and, if we are paying for these stories as a service, we will demand it. Netflix, Amazon, HBO and any others wanting to compete here for consumer dollars need to be extremely aggressive in how much original content they release regularly. Again, the demand, if this future comes to fruition, is that we will always want a fresh story. That will be expensive.

I often emphasize a point that consumer markets are not generally “winner take all” markets. However, this may be one of those areas where it could be, simply on the point of economics to invest and create original stories at a frequent pace. The capital intensive nature of this business model means those who pull it off will acquire the most customers and can turn that revenue scale into investments in new content.

While I think the market can only support a few players, I doubt owning the market will generate the revenue needed to create enough content. Over the top services will need outside productions to purchase rights to or co-producers to help with the costs of original production. Or production will need be subsidized through ads or other areas. This is where Amazon has an advantage over Netflix; they are not afraid to loose money to gain market share and they have alternate revenue streams.

Netflix and the Future of Entertainment

Tags: Broadcasting