The entertainment business has finally smacked up against reality. It’s just not profitable to offer the bulk of a studio’s catalog (including the newest theatrical hits) at a subscription price around $10 a month. Who knew?
Studio executives of yore.
In the rush to cut costs to fill the profit hole left by the subscription streaming craze, perhaps entertainment chiefs should look to those past strategies. Maybe it’s time to reinstall some windows.
Raising SVOD sub prices (as many have done), selling ads (as Netflix and others have done) and cutting costs by laying off 7,000 to save $5.5 billion (a la Disney) are only stop-gap measures. Windows are, and have always been, a way to extract the maximum revenue from content.
Studios need to go back to basics. Offer content in the window (and successive windows) that will extract the best overall return. For some titles, that begins with a theatrical window; for others it starts in the home entertainment pipeline, including streaming. But it makes sense for some very desirable titles to open numerous windows between theatrical and streaming — including newer, higher-priced premium digital purchase (PEST) and rental (PVOD) windows. And let’s not forget regularly priced digital purchase and rental — and disc.
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Streaming is only one stop in the entertainment pipeline. It doesn’t necessarily have to be the first or last. Services should get content when it’s the best time for that content to maximize revenue. Streaming — no longer the shiny new kid on the block — should earn its place in the window lineup.