- All right.
We've always hosted conversations on this channel
trying to save people cash
and help folks make informed decisions on services to try.
These days, our entertainment dollars
are getting stretched thinner and thinner.
It's less a thing we just say in our videos
and a lot of conversations are happening
behind the scenes here with our editors.
How do we cover these topics,
stay on the pulse, and offer good advice
in a rapidly changing media landscape?
One such major change coming
to many streaming services,
the addition of ad supported tiers
to their subscription options.
Every company is looking to maximize revenue
on every consumer interaction
but is this the beginning of streaming shrinkflation?
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We can play into those cute little phrases
like the streaming fatigue is real,
but genuinely the current market is proving unsustainable.
Way too many subscriptions to keep track of,
increasing costs, confusing bundles,
and at some point we all just run out of time
to consume the content.
We're seeing some diminishing returns.
It matters a little less
if every streaming service has amazing shows to watch
if I literally can't find more time to watch them all.
I've been binging a number of Netflix shows
at 1.5 times speed.
It's not quite as satisfying a viewing experience.
So what's an intrepid media service to do?
How can they encourage more signups
and monetize more per consumer interaction?
What if they started serving more ads?
It's feeling a little like the early days
of cable if you're old enough to remember that.
We paid a subscription fee for a certain block of channels,
but later we still got ads
and commercials on all our programs.
Fun little trip down memory lane there.
Netflix, as the most visible platform in this discussion,
is in a weird spot.
So many people are using the service without paying for it
that it kind of makes sense
they would want to shrink their user base.
That's terrible PR,
but it's probably good for expenses and revenue.
The server, hosting, licensing,
and distribution costs are pretty heavy.
Netflix can hope they might convert a few folks
sharing passwords into having their own accounts
and that's where some lower pricing might be enticing.
The dollar amount on a signup page
is a good psychological hook.
The top option is still expensive.
The steps are really broad, and right now on Netflix
you can't better customize what your family might need.
I can't tailor fit a plan
to number of screens and quality of streams.
I gotta go all or nothing.
With these gaps in the pricing,
we could slot in ad supported tiers
and have that look like a more significant cost savings.
The fear many of us have on a service
that's already pretty spendy
is that Netflix will use the current prices
for ad tiers and then make ad free even more expensive.
Like so many consumer services now,
we end up paying more, not for better service,
but just to get hassled less.
I call that the airline strategy.
Let's just keep charging more for basic human dignity.
But I digress.
I believe Netflix would keep their current tiers
and charge less for ads,
but there's no guarantee they won't raise prices over time
if they see any success in this strategy.
To even begin to predict,
we'd need better data on a service like Hulu,
get a little peak behind the scenes
and see how many subscribers pay
to remove ads on Hulu Originals.
There's just too much money involved
for ad free to remain the default.
Disney is perfectly content to wait out the market,
you know, maybe even offer streaming at a loss
subsidized by the rest of their media empire,
and let Netflix walk an unpopular trail first.
They'll sit back, let Netflix take the PR hit,
and then quietly every other service will piggyback
on the same model
after the initial Netflix fury has died down.
But I don't think it's controversial
to say that the writing is on the wall,
that the glory days of online media streaming
are probably behind us.
The shows and movies have never been better.
There's tons of brilliant content to consume,
but we're starting to see more and more
of the behind the scenes business deals at play:
Disney's acquisitions, Netflix slashing budgets,
canceling shows, and whatever's happening
at HBO, Discovery.
That just looks like a mess.
While these companies raise prices
and explore alternative monetization,
even YouTube is experimenting
with up to 10 ads before playing a video.
It definitely feels like we're getting squeezed.
So this isn't a traditional example of shrinkflation,
but we're either getting the same product
at a higher cost
or more of our time is used trying
to watch the same content
and I don't really see
where there's a consumer-facing solution to this trend.
Increasingly with my family and friends,
I'm pushing harder and harder
for people to cycle their services.
We can lose track pretty quick
how much all this stuff costs.
As an example, if you rent a single new release movie,
that can cost as much as 20 bucks.
Instead, we could rent a streaming catalog or two
for a whole month for the same price as a new new release.
Putting those dollars into perspective,
a movie versus an entire streaming catalog,
that still looks like a pretty good deal
for most streaming services.
The tricky part is knowing
that some platforms like Disney are going
to give you the best prices when you subscribe
for a whole year. But we've gone a couple weeks at a time
not watching anything on Disney Plus.
So if you're really not watching it all the time,
are you really saving money compared
to turning off the sub for a couple of months
and then binging all the new stuff a couple times a year?
Don't even get me started on the amoeba of services
that is Amazon Prime.
I'm gonna have to save that for its own standalone video.
Cycling takes a lot more discipline,
which quite frankly is exhausting,
but it makes some sense.
You know, maybe scale back your media streaming
to a set dollar amount every month.
And if you're gonna have to deal with ads,
there are a ton of other options for streaming content
that won't cost you anything for ad supported streaming.
And if you want to see a current breakdown
on cheap and free services,
drop us some comments down below.
Lastly, one more quick aside,
it's always a good time to remind folks
about their local library.
Chances are pretty good
you can get a lot of stuff to watch for free
and not deal with ads at all.
So go sign up for your library card.
Whew, this kind of topic makes me a little cranky.
And it seems like such a small thing,
but our entertainment dollars
and our entertainment hours are really precious right now.
I do not get a lot of downtime
and I'm sure a number of folks out there
are in similar situations.
So it's this little rock in my shoe
trying to deal with this stuff,
and it sucks a lot of the fun out of cool technology
if I'm constantly reminded how much more
I'm spending on streaming media.
It's making all this a lot less fun.
So if you have other solutions
for handling digital shrinkflation,
please drop those options down below.
As always, thanks so much for watching,
for sharing these videos, and subscribing to the channel.
For reviews.org, I'm Juan Carlos Bagnell,
aka Some Gadget Guy,
and I will catch you all on the next video.