When I said streaming TV would fail

Back in 2013 I published an editorial called, “The nightmare scenario of streaming TV.” In it I gave a grim prediction: All free TV could be gone by 2017. Obviously I was way off, but only because people decided commercials weren’t so bad.

If you don’t want the long read…

Here’s the basic thrust of what I said.

  • Broadcast networks fail first, because people skip commercials
  • Everyone cuts the cord to avoid high cable bills
  • Streaming services fail because they need to charge too much, since they have to pay more for network shows

Here’s what I got right

Back in 2013, streaming seemed like a great deal. Netflix’s streaming service was about $6 a month and Hulu still had a free service. Today, combine Hulu, Netflix and CBS All Access for a basic on-demand streaming system and you’re paying $27/month. Add a live TV service like Sling and you’re paying at least another $30 a month. That’s ten times what you were paying back then. Yes, you get more but the cost is beginning to get to the point where people are looking for alternatives.

Here’s what actually happened.

First of all, people decided that a few commercial breaks weren’t so bad. The major broadcast networks created entertainment that you wanted to watch live, and that means watching commercials. That took a lot of stress off and enabled the four major broadcast networks to survive even though they’re attracting about 10% of the viewership they once were.

Then, companies like Netflix and Hulu started creating content worth paying for. Sure, Netflix has had The Office and Friends. Those two seem to account for about 10% of Netflix’s total viewing. But more importantly they started creating a mountain of original programs. They created so much original programming that you knew at least a little bit of it would be good. Granted I think only about 5% of Netflix’s originals are good but that’s driving enough profit that they can keep creating the other dreck. Same with Hulu, HBO, and Starz.

It also didn’t hurt that internet speeds went up sharply. It was still pretty common to see people on 3Mbps DSL back in 2013. People who really had it going on, they had 15Mbps service. Today 100Mbps service is so common, it’s the lowest tier in many plans. This has increased satisfaction in streaming providers and made people feel better about paying more.

In fact…

Streaming is stronger now because it’s diversified. You can still pay next-to-nothing and get great entertainment. With an antenna and your own DVR, you can get plenty of live shows. With services like Pluto and Crackle you can watch a few commercials but you get a lot of stuff.  And, if you want the full cable experience, you can get a live streaming service.

And best of all, the broadcast networks didn’t die. Neither did satellite TV. Back in 2013, DIRECTV was a separate entity. Today as part of AT&T they’re shielded from short-term losses and can still operate the best TV service out there.