The Paywall Will Be the Death of Streaming As We Know It

Paywalls will kill your favorite streaming service.

Everyone thinks that the streaming services are killing cable and that’s the whole story. They’re wrong. Streaming services are also killing themselves. Sure, Netflix has been doing well from a content standpoint, they are putting out great stuff and they’re putting out a lot of it, but they are in debt and eventually just like in every other tech industry, someone else will come along and take them out. We still win; all of those Marvel shows, all of those comedy specials, House of Cards, Stranger Things, and everything else is already made it’ll still exist and somehow someway it’ll be available.

But right now Netflix is the only game in town, they have our eye balls and our 9.99 a month. Hulu and Amazon are right there. Amazon especially is churning a comparable amount of quality, they just haven’t trained us to get to them yet. They haven’t trained us to browse through their applications yet and they are muddy with pay items and premium channel subscriptions, but their pockets are deep, maybe they won’t be the next Netflix, but they’ll definitely have a part in breaking Netflix down.

Streaming services and cable channels are killing themselves by building paywalls, even if the Netflix paywall seems low, it’ll eventually come around and bite them in the ass. In fact, I say Netflix is lucky it hasn’t already tumbled. YouTube and Facebook have been nobodies in quality content, instead relying on others to post their mediocre videos that could never get to the heights of Game of Thrones and House of Cards. So a mix of other websites with the requisite eyeballs, the fact that Netflix isn’t completely dumb and are keeping the paywall low and that their content has been pretty good.

Thanks for the good content. But the paywall is a killer and these other websites aren’t going to be sitting idle for very much longer. Facebook has the big data cache that Netflix wishes it had to make programming decisions. Amazon has the alternative way to get us to pay for Prime.

The next part of this mess is the creators and studios who are taking the money but putting their stuff behind the paywall. I love all the Marvel stuff but Marvel is lucky that besides the movies I happen to have Netflix and ABC isn’t so dumb that they made Agents of Shield free online (although the commercial structure online is so annoying that it could have driven a lesser person to go steal it). Guess what? I don’t have Freeform and I don’t have Hulu. What are most people who want to watch those shows going to do? They are going to either steal them or they’re not going to matter. Eyeballs are what matters.

For the most part, those shows are marketing for the huge budget movies, they shouldn’t be so hard to find. Put them everywhere.

Make events of what’s going on. After I finish the first draft of this newsletter/post I am going to go watch a television premiere in an IMAX theatre. It’s an event! Inhumans! It’s going to be cool and they’re going to get $20 from the tickets I buy my wife and I. How much of my $10 did Marvel make from Daredevil? Plus I’m now invested in Inhumans and will watch it on ABC.com despite the obnoxious commercial structure. (Update: I paid $20 each for those Inhumans tickets, the show was cool but no it wasn’t worth it).

I am a huge geek. The nerd of nerds. Am I going to pay an additional $5 or $10 for CBS’s crappy streaming service just to watch Star Trek? No I’m not. I will find another way to watch it. I’ll go to a friend’s house or I’ll naturally miss three or four episodes and then just get the week free. Don’t put me behind a paywall, figure out how to make this an event. Get my eyeballs on this and figure out how to make something live action part of the canon. So many ideas, the paywall is so simple and so 2010s. It’ll even be the death of Netflix even at 9.99.

Once Amazon figures this out, they’ll be set. Their streaming is a side business as of now. They don’t have to worry about making The Tick live action or going on tour like a recording artist can (although The Tick might work better than anything else). They’ve figured out how to get you to realize the $100 a year is worth it for free shipping; it’s a scary prospect when they figure out how to get you to click on Prime Video button on your smart TV.

Facebook Watch just premiered today. I just got the little announcement on the app telling me how to use it. They already have some content available. I may or may not watch it. A lot of it is about buzz and quality and access. The other part is about what I have time for and whether it fits in with the kind of thing I already watch. But the eyeballs are there and after a whole day they’re already at least on par with what YouTube Red has produced and YouTube has had over a year to actually build something decent. No excuses for YouTube and even less for them that it went behind that paywall, even if Google Music is the best deal in music streaming because of YouTube Red.

So I’ve said it here, the paywalls will even topple the mighty Netflix. Netflix will exist but it won’t sit on the streaming throne forever.

Quality and eyeballs are what makes your platform or channel matter; first come the eyes, then comes the talk, then make the money. Outside of video, a lot of people thought Facebook couldn’t make money with only eyeballs, but now there is no question they succeeded at monetizing and so long as the new Facebook video service stays free and they are able to produce great content with their valuable big data cache, they will be the victors and the last ones standing. And whoever else learns that this is the game from here on out.