Streaming Content is Going to Get Very, Very Expensive


Netflix original ‘Marco Polo’ cost the service around $90 million dollars, and in a few years, that might seem like a deal.

As just about every major media service is now planning to roll out some form of a streaming service in the coming years, it seems likely that most of them are going to end up competing for content.

HBO used to be the only real streaming service, and truly only with HBO Go being a bit of an afterthought service, that had any original content. Then Netflix started ramping up its content offering with shows like ‘House of Cards’ and ‘Orange is the New Black’ showing just how much muscle these services had to flex.

And it seemed like for a while it might just be Netflix and HBO duking it out while nobody else really caught on. Certainly network television was still the bellwether for producing television shows, but things recently have drastically started to change.

All of the sudden Netflix, Hulu and Amazon Prime are being nominated for awards, and their ratings are starting to skyrocket. Crackle original ‘The Art of More’ just confirmed that over two million people have tuned in to watch at least part of the series on their free service.

So what does this mean for the future of original shows? Frankly, it puts the ball squarely in the court of content producers. As any network exec will tell you, it’s hard times out there trying to find the next major television show. Competing with services that allow users to stream TV online has made things incredibly difficult.

There is already an apparent shortage of quality television available for both broadcast and cable networks to choose from each season, and streaming services are only going to make this more complicated. The appeal of working with Netflix, HBO and others often times far outweighs the risks of trying to promote a show via network television. Reports that showrunners are given considerable creative freedoms working with more modern streaming services certainly lead us to believe that working with these companies is far less of a secondary option and instead might be the first place they turn when looking to pitch an idea.

But all this comes with a huge cost now. For services such as Hulu, still working to have their ‘House of Cards’ moment, the stakes continue to get higher, as the cost of original programming is on the rise. Netflix, as it fights to produce nearly double the number of originals next year will end up likely having to pay a hefty amount to bring in the best new titles.

While we’re willing to bet long on the future of SVOD, we do expect there to be a lull in high quality original programming, especially on only a handful of services. Instead, quality titles will likely be spread relatively thin across multiple offerings. In the short term this will only continue to make things more confusing for consumers.

Perhaps this is why Amazon Fire TV and Apple TV are working so hard to establish bundled streaming packages.