TV's Golden Era Proved Costly To Streamers

Consumers are winning from the streaming revolution but across most of Hollywood, the businesses churning out TV and movies are losing. From a report: Services such as Netflix, Disney+, Paramount+ and Max have become the default entertainment options for homes across America rather than cable, saving many consumers money. For the titans of Hollywood, that shift has been costly. Traditional media and entertainment companies have reported losses of more than $20 billion combined since early 2020 on their direct-to-consumer streaming businesses. Netflix, which brings in profits, is an exception, but the rest of the industry is wondering: While consumers love streaming, is it actually a good business? Investors now care about profitability rather than growth, a change that makes finding new revenue streams and retaining customers critical. Studios that for years were able to splurge on content to feed viewers' insatiable appetite for new shows and films now must pull back to make the math work. The ad market is weakening, many companies have laid off staff to save money and Hollywood writers are on strike. Market values for Paramount Global, Comcast, Walt Disney and Netflix are down more than $280 billion combined since the end of 2020. Warner Bros. Discovery is worth about half of its total value since its 2022 trading debut as a combined company. The declines have come after many of the stocks rose during the early part of the pandemic, when consumers were stuck at home and hungry for entertainment.

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