Barry Diller, longtime TV/entertainment executive and chairman of IAC/InterActiveCorp and Expedia Group, told
Recode Hollywood is
“now irrelevant.” If you were one of six major studios you once controlled everything, according to Diller. That's over.
As he and others have said, Netflix is way ahead of rival entertainment concerns --
especially now with 60 million U.S. subscribers -- when it comes direct-to-consumer (DTC) home video.
“Netflix has won this game,” he says. Which begs the question: What’s
the new game?
Walt Disney, WarnerMedia, NBCUniversal are chasing after Netflix with similar DTC aspirations in the video streaming field -- to get consumers to buy premium TV content
directly.
But at the same time, Disney, WarnerMedia, and NBCU are looking to wean themselves away from those carriage/retrans revenues.
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That’s hard to do. While those revenue
percentage gains are dipping a bit, they still register around 5% hikes over the last several years. All while seeing real-dollar stagnation or declines in traditional linear TV advertising.
As for Hollywood being irrelevant? Well, not for the old Hollywood business. Walt Disney still made $7 billion in theatrical revenues globally in 2018 and $3 billion in U.S. box office.
Netflix isn’t on this list -- right now, anyway. Its attention is on the video platform.
That said, it doesn’t mind using theatrical-based awards events, like the Academy
Awards, to garner big hardware and consumer attention. Netflix is spending some $25 million just for Oscar advertising and marketing for its film “Roma.”
The new game?
We’ve heard this many times before: Amazon.
The ecommerce company knows consumers buy lots of stuff -- nonentertainment products like electric toothbrushes, furniture, clothes,
groceries. All have a strong advertising connection. Now toss in the lure of big entertainment content to its 100 million Amazon Prime subscribers.
Chess moves from this new consumerism is
just beginning.