Unauthoritative Pronouncements

This morning, two emails came in from Apple. The first was about the upcoming renewal of my yearly subscription to Disney+ and the second email was about the price increase of my Disney+ subscription from $79.99 to $109.99. It took me all of 10 seconds to think about it, but I canceled my subscription. It’s not really about the $30 price increase, which is outrageous, but mostly because there won’t be 12 months of TV show and movies to watch, in no small part thanks to the actions of Disney’s CEO.

I’m affected by the ongoing strikes, where the studios have once again walked away from the negotiating table. Almost all entertainment production has ground to a halt. The recent resolution of the WGA strike was celebrated, but it was a long, and painful process. All of our hopes, as workers in this industry, were pinned on the SAG-AFTRA dispute coming to a close. Instead, the studios decided to do what they did months ago in the WGA strike and take their case to the Hollywood trade publications owned by Penske Media in the hopes that they could gin up dissent in the union to push the union negotiators. It didn’t work with the WGA membership, and I don’t think anyone other than studio brass expects it to work on SAG-AFTRA either. There can be no resolution external to negotiation, so this just delays everything.

Films and shows that were slated to come out this year have been spread out, some pushing to next year. You can only spread things out so far, and that is particularly true of all the studio streamers that got into this game late.

When Disney+ first premiered it was criticized for only having The Mandalorian and WandaVision which were both over in the blink of an eye. Marvel, for me, has had diminishing returns since then, and I would not subscribe to Disney+ to exclusively watch anything from Marvel at this point.

Star Wars, unfortunately, is also on the bubble with several disappointments, including the most recent Star Wars: Ahsoka where I watched 50 minutes of space whales doing space whale stuff. Stretching Star Wars: Skeleton Key and Star Wars: The Acolyte out into next year, with both unlikely to be as inspired as Star Wars: Andor doesn’t convince me that $109.99 needs to leave my bank account right this very minute. If anything I can always dip in if it’s good, or wait until it’s over and binge. A year of, basically nothing, isn’t a year I need to pay for.

How Did We Get Here?

Disney, and everyone else, sold streaming licensing rights to Netflix for many years. It was like selling the broadcast rights for a film to appear on an old-fashioned TV channel. Audiences were trained to expect streaming media. Bob Iger, infamously, compared this to arms dealing, in a metaphor that no one really thought he should be making. Then Disney’s contract with Netflix ended and they went direct to consumer with Disney+.

I still remember the live-streamed shareholder meeting where Disney+ was first announced and Christine McCarthy (former CFO) outlined how the company’s low introductory price, and small number of territories, meant that it would be unprofitable for many, many years. Disney expected the stock market to treat Disney like they treated Netflix, which at the time was operating on a growth model. Everything was upended by the pandemic halting production, starving new services of new entertainment, and then by the Netflix Correction, where interest rates were up and shareholders wanted to see revenue off those subscribers, not just growth. That was not something Disney was prepared for, at any level of the company.

Bob Iger’s plans for Disney+ had blown up spectacularly and his hand-picked successor was ousted, by himself, so he could fix his own plans. Unfortunately, he’s been one of the people chiefly responsible for the WGA and SAG-AFTRA issues this year. A lot of the assumptions based on the finances of streaming have to do with taking advantage of labor contracts that didn’t cover streaming well. The AI likeness issue is a huge deal for Disney, not just the money, and they would very much like to treat actors like ageless property that can be applied to their sprawling connected universes.

Not a Boycott

Neither the writers, nor the actors, called for boycotts of the streaming services. They want to work, and they want to be paid, which means people need to pay the studios. That’s the how the system is supposed to work.

Hell, I have absolutely nothing to gain by people canceling their subscriptions. The only way I get paid is by the studios hiring VFX houses. Actors and writers don’t pay me.

Having said that, I absolutely do not need to pay studios a yearly subscription for 2024. They haven’t earned that from me on a personal level. Also none of these streaming price hikes translate into any benefit for me, the pressure is still on cutting costs in producing content.

What services every person choses to pay for are deeply personal, based on all kinds of factors, so there will be people for whom Disney+ is still essential, even without new content. Or they might be willing to step down to an ad-supported plan (I’m not). Disney+ does have an extensive library.

Same goes for Warner Brothers Discovery’s Max, which has been rightfully criticized along the way because of David Zaslav’s bumbling, and attempts to stuff the service with lower-cost unscripted fare from Discovery.

Smaller streamers are faced with these same problems, because they did what the big studios did, but they don’t have the libraries, IP, cash, or really anything to compete with the big studios. That’s why they’re small studios. It’s not that hard to understand, but it’s why Paramount+ following along has really hurt Paramount Global. While Comcast is huge, the part that’s a studio, isn’t (NBCUniversal).

Outside Money

However, things get a little more interesting with Netflix and Prime Video. My opinion of these services is not especially high. In the past month, Prime Video announced it was going to include ads in its previously ad-free entertainment, which was already intermingled with FreeVee ad-supported content. An extra recurring subscription can be paid to watch without ads. Amazon keeps tacking on all these fees onto a product that was supposed to be an all-inclusive affair. Like, that’s supposed to be their whole thing, you know? Their shows are generally expensive, and seemingly don’t do much to motivate any meaningful internal metrics for Amazon. It still pays to license some high quality TV shows and movies from others. That’s really its core value, that I’m not sure Amazon entirely understands.

Netflix’s mediocre filler piles up more and more every day. Like a machine that only knows how to spit out half-packaged products. It’s biggest asset is its size. I wouldn’t say it’s too big to fail, but it’s too ubiquitous to ever fail quickly. Which is why they can continue to generally fuck up a lot, and do stupid shit. Shareholders have calmed down since The Netflix Correction, and they’re generally content. There are no concerns about Netflix ever ratcheting up it’s fees too high, the concerns are about the slow growth of their ad-supported tier to bring in more price-conscious consumers.

The most recent stumble for Netflix has been in kid-focused animated entertainment. Their history was mostly with buying up stuff from outside companies (Mitchells vs the Machines is frequently cited as a Netflix film, but it’s a Sony Pictures Animation film that Sony sold off in the pandemic), until they started their own internal division. Then last week they announced they were killing projects and cutting staff. Then this week they announced they were going to be taking over Apple’s end of their deal with Skydance Animation. The animation company owned by nepo baby David Ellison, and headed up by the disgraced John Lasseter. David proved to the world that it was worth it to hire John by releasing Luck, a film that at best, was fine but not a critical or financial success for Apple.

Netflix’s flailing with making their own films and TV shows kind of doesn’t matter because they’re so big that they can turn licensed library material into a phenomenon. The most recent example being the craze over Suits which originally aired on USA Network, owned by Comcast Universal. Comcast Universal can’t turn anything into a success because it entered the market late with Peacock, and no one could think of a reason to subscribe to it if they weren’t already a Comcast customer.

This ability to turn something that could be a small success, and large financial loss, into a big hit by virtue of its ubiquity is what Netflix does best. To circle back to animation, this is also why the plug was pulled on the Paramount+ and Nickelodeon show Star Trek: Prodigy and it found a home on Netflix. Paramount Global will get money for something that wasn’t working for them, because Paramount+ isn’t ubiquitous.

Netlfix has also licensed a bunch of HBO shows, which is hugely damaging to Max, because it trains customers to expect HBO shows eventually coming to Netflix, but does help Netflix with their quality problem.

So Netflix increasing their prices to nearly cable-package prices? It’s not something I like at all, but it’s working for them because they’re basically a cable package of licensed stuff again, like they were before the studios panicked and tried to start their own streamers.

They can weather anything 2024 throws at them because there will always be studios desperate enough to sell shows to them, even if that excludes Disney. The SAG-AFTRA dispute could go on for another year and they’d buy their way through it. As repulsive as that thought is, it’s true.

The Lost Year

There is, unfortunately, the very real possibility that nothing gets resolved before the winter holidays — or even if it does, productions won’t start ramping up until next January or February. When it resumes, it’s not like turning on a light switch. The entertainment industry works with overlapping schedules. This production starts while this one wraps, this is shooting while this is in post. You just can’t do everything in parallel all at the same time. That means we’re also going to get a trickle of finished TV shows and films. Even lowering the standards, and “putting a rush” on it doesn’t bypass everyone else doing exactly the same thing.

That means that even if people aren’t anticipating the drop in stuff to watch, they will eventually realize that there’s not much new. It’s going to be much harder to get those people to resubscribe, at high prices, than it was to get them to subscribe the first time.

I’m not sure what’s going to get me to reactivate Disney+, maybe it’ll be whenever the second season of Andor comes out towards the end of 2024 or early 2025, but it’ll just be the two months the show runs, and then I’m out again like the Falcon leaving the Death Star. Disney has lost yearly subscription rights in this household. A brand is a promise and the only promise I’m interested in from Disney is a single TV show, on a calendar far, far away.