The demand for production of TV series is growing, and the main engine of this growth is Netflix. Traditional TV channels are trying to compete with streaming platforms and also increase the volume of content production — quality TV movies and series needs in the long term to increase the volume and loyalty of the audience. However, there is another option, which is useful to weigh the major media conglomerates: get short-term gain from the sale of its products to competitors.
Netflix, Disney, Hulu and other streaming players in the market are investing in original content the incredible amount of CBS and Viacom, it is logical to use the situation, the more both companies have a strong production resources. For Viacom, which owns brands MTV, Nickelodeon and Comedy Central, is now also working creative team AwesomenessTV. In addition, Viacom owns Paramount TV channel that sells a lot of content platforms such as Netflix and Amazon. Series produced by CBS are also in demand on the platforms of competitors.
No one knows exactly what will TV and more in five or ten years, but the players in this market it’s time to choose a strategy of monetization of content.
Netflix last year spent $13 billion on video content, and intends to spend even more, deprived of rights on the part of the catalogue, the service relies on a private and exclusive products. It is known that Hulu in 2017 spent on the content of $2.5 billion — this amount will increase significantly, given that the company plans this year to issue 40 new films and TV series. The company is now wholly owned by Disney, and plans to invest in production and purchase of content impressive budgets, like Hulu, and their own streaming service Disney+ that will launch in the fall. Big budget content needs to allocate two more preparing to launch a major platform — WarnerMedia and NBCUniversal.
News organisations will be difficult to pass by such amounts. That is why Viacom increase the number of studios within controlled channels MTV, Nickelodeon and Comedy Central: staff personnel will deliver some content by ordering the streaming giant, and owned by Viacom Studio Awesomeness TV is already selling movies and TV shows Netflix and Hulu. This is not to mention a gold mine of content in the form of Paramount TV, which is owned by Viacom: it is expected that in 2019, the company will earn $600 million by selling Netflix series “the Ghosts of hill house” and selling Amazon series “Jack Ryan”. In Viacom believe that by the end of the year the result of the work of all studios owned by the company, can be a profit in excess of $1 billion
Related Viacom (both owned by American media Mogul Sumner Redstone to) broadcaster CBS also actively sells his product to competing TV channels and streaming platforms Netflix bought the series “Dead to me”, and for Disney+ bought “diary of a female President”; in total this year, the Studio owned by CBS sold about a quarter of the production to other companies.
This practice in television is not new, the TV Studio and used to sell its products to business competitors. For example, “the big Bang Theory” filmed in Warner, and was shown on CBS.
Some competitors CBS — namely Disney and WarnerMedia, but instead focused on filling out directories, exclusive production of private studios, or procure third-party content.
Specialist in business strategy from the company Doing Work As Chris Erwin notes that the studios and broadcasters it is important to determine the long-term plans for their products: “Many ready to take advantage of the growing demand for movies and TV shows, and relatively fast to make — are now actively developing the infrastructure and services, new jobs and opportunities. But for a company to be more proactive to keep exclusive rights on their products”.
However, it is possible to use a combined strategy — as it has successfully done in Viacom. The money companies bring kangaroo Rocco and alien Zack: Netflix bought the rights to feature-length movies with these characters. But the series about Rocco and Zach, thanks to which became famous for these characters, and Viacom shows on a digital channel Nick Hits, available for $8 per month in the catalogs of Amazon Prime Video Channels and Apple TV Channels. Thus, Viacom earns only partially on the content of Netflix and other budgets — while increasing the number of subscribers and satisfy their devoted audience. Viacom also successfully develop their international video service Noggin with cartoons of children — it already has 2.5 million subscribers.
Intellectual property becomes the main subject of competition in the entertainment industry in the period, while the impact on the digital TV market is concentrated in the hands of a few giant companies. Time will tell who will manage content more profitable, and what will be the future of television, nobody knows. Netflix continues to increase its audience and to invest in products, AT&T and Comcast also actively spent on content, and Disney is preparing to launch the platform with perhaps the largest catalog of films and TV series for family audiences.
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