Is video streaming still worth it?

When Netflix first unveiled its streaming video service in 2007, it felt like a miracle. Netflix DVD subscribers in the US, paying between $5.99 and $17.99 per month, instantly got access to 1,000 movies on the web browser. No more waiting for DVDs in the mail, no more commercials like TV – just press a button and watch. Immediately! Now it seems like it was centuries ago. Netflix’s most premium 4K streaming plan now costs $23 per month, while its standard subscription without ads costs $15.49 per month. (There is a standard plan with ads for $6.99 per month, but it does not support offline downloads and excludes some content.)

Netflix has also been cracking down on account sharing recently, which is great for its overall earnings and subscriber numbers, but bad for anyone trying to save money. To add more member slots to the Standard and Premium plans, you will have to pay an additional $7.99 per month.

And it’s not just Netflix. Over the past year, almost every major streaming service has raised its prices significantly. Apple TV+ is doubling its original price to $10 per month ($99 annually). The ad-free premium tier of Disney+ also got a huge increase to $14 per month. For those who subscribe to multiple services, it’s easy to think we’re back in the bad old days of cable TV, where we’d shell out tons of money for hundreds of channels.

But let’s not be dramatic. Subscribing to the streaming services you use most is still far cheaper than a typical cable plan. In my area, Comcast’s most popular plan with more than 125 channels is listed at $60 per month, but the company hides an additional $27.80 broadcast network fee and a $13.40 regional sports licensing fee. My Real Monthly cost starts at $101.20, and that doesn’t include taxes, equipment rental fees (at least $10 per month) and other extras Comcast may add you to. (Want 300 hours of Cloud DVR? It’s an extra $20 monthly!)

According to Bureau of Labor StatisticsThe average urban consumer spends $575 per month on cable, satellite or live streaming TV service. Clearly, these numbers show that some customers are spending much more on games and other packages than others. But still, the prospect of spending $370 per month on cable (the BLS consumer average from 2010) also seems unfathomable. Suddenly, Netflix’s move to $25 doesn’t seem so bad — especially for cable subscribers Too One has to subscribe to streaming services to watch their original shows.

strange things on netflix
Netflix

While some have argued that streaming is a sign of price increases end of dream of cutting the rope, This is far from the truth. Cable prices were high just a decade ago, and they have increased significantly since then. (broadcast fees alone were It is projected to rise between 8 and 10 percent between 2016 and 2019..) If anything, the case for cord-cutting is even stronger now. With the abundance of content available on streaming services, do you really need to pay hundreds to sit through yet another HGTV marathon? Especially when you can find some HGTV content on Max and similar shows on other streamers?

No one likes to see their favorite services become more expensive. You could easily argue that the rise in streaming prices is coming down strongly. Cory Doctorow’s concept of Internet anxiomization, in which companies provide cheap and useful services to grow their user base, but essentially make the experience worse in order to squeeze out more money and please their investors. Unless an online service is being run as a non-profit or completely free side project, encroachment seems inevitable.

But it’s worth acknowledging why streaming services were so cheap to begin with. Netflix’s streaming service was practically an experiment in the beginning – it was bundled into existing subscription plans, and you could only watch up to 18 hours a month. When Netflix launched its standalone streaming subscription in 2010, it was only $7.99 per month — a price that remained true until its basic plan went up to a whole dollar in 2019. While the company introduced more expensive standard and premium plans along the way, the entry plan always seemed like a tremendous deal. Who wouldn’t want instant access to thousands of movies and TV shows for the price of two coffees?

Like many startups during the 2010s, Netflix continued to raise a lot of money (about $5 billion). without making huge profits – or at least, not commensurate benefits The company has spent crores and billions of rupees on original content In the last decade. Attracting new customers And It was much more important for Netflix to retain them than to actually have a sustainable business. So it wasn’t much of a surprise when other services like HBO Max, Disney+, and Apple TV+ launched at lower prices to compete with Netflix.

According to Junko Roettgers, author of Newsletter Lopassand a former media and technology reporter Diversity, Netflix had an advantage over the competition because its legacy DVD business could support its streaming ambitions. Other companies like Disney and Warner Bros. had to decide how streaming would fit into their existing TV channels and movie studios.

“Now (Netflix) is making money from streaming around the world, and they’re starting to get into gaming,” Roettgers said on the Engadget podcast this week. “So they’re very quick to follow. And if you look at some of these legacy media companies, well, they still have linear networks. And they’re slowly and slowly shrinking, and they know it.” It’s taking a long time to deploy (…) Should we get out of it? How many can we keep on? How many of them do we need to close?”

When Netflix announced it was actually losing subscribers in 2022 — 200,000 in the first quarter, followed by a million users in the second quarter — it was like a nuclear bomb detonated in the streaming industry. This immediately led to belt-tightening at every service: widespread layoffs, canceled shows, and more strategies to make money. Netflix’s ad-supported tier launched later that year, while its account sharing lockdowns began this May.

Din Djarin holds Grogu in The Mandalorian season 3
lucasfilm

With interest rates rising and investors worried about the economy, raising prices was the inevitable next step for every streaming provider. And unfortunately, this trend won’t be reversed any time soon. At most, we can only hope that the threat of losing users and the pressure of competition will keep Netflix and others from reaching the dangerous heights of cable.

But don’t forget, there’s one thing you can do with streaming services that’s far more difficult with cable companies: You can cancel and subscribe easily online. You don’t have to set aside time and emotional energy to deal with a customer service representative on the phone, or carve out time in the morning for a technician to come. This possibility of churn looms over every streaming provider. So if their prices get too high, or they’re not really providing enough valuable content to watch, just leave.

Still, it’s worth remembering that access to media is cheaper than ever. You don’t have to worry about spending a lot to rent movies from Blockbuster or your local video store. There are no late fees to worry about. And while I miss the heyday of DVDs, buying just one of those discs today can get a month’s service across two streaming services (sometimes three!).

So sure, it stinks that Netflix is ​​getting more expensive. But, personally, I would easily accept these higher prices for a lifetime before the streaming era.

This article was originally published on Engadget

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