warner bros. discovery – Techdirt (original) (raw)

Streaming Video Prices Rise While Quality Falls, Following Cable TV’s Lead

from the enshittify-everything dept

Streaming video still provides some meaningful advantages to traditional cable: it’s generally cheaper (assuming you don’t sign up for every service under the sun); customer satisfaction ratings are generally higher; and users have more power to pick and choose and cancel services at a whim.

But the party simply isn’t poised to last.

Thanks to industry consolidation and saturated market growth, streaming giants have started behaving much like the traditional cable giants they once disrupted. As with most industries suffering from “enshittification,” that generally means steadily worse service at higher prices to appease Wall Street’s demand for improved quarterly returns at any cost (even long term company health).

As a result, Netflix has started acting like password sharing, something it advocated for for years, is a dire cardinal sin. Amazon now thinks would be fun to increase the number of ads it runs, charging Amazon Prime users even more money to avoid them. Consumers are paying more for streaming than ever as layoffs abound, streaming catalogs shrink, and the underlying product quality gets worse.

Ars Technica points to a recent flood of surveys from TiVO, CableTV.com, and Whip Media that all show that streaming customers continue to report a drop in the quality and customer satisfaction of streaming services over the last few years. When asked why this is happening, TiVo analysts suggest the problem is simply that companies are struggling to make streaming profitable:

“The amount of new original content overall on SVODs may be down [year over year] as many streamers continue to struggle to hit profitability targets. Without new original content (or exclusive content deals), perceptions of value/differentiation may decline.”

You’ll notice that neither the trend-studying organizations nor Ars discuss several important things. One, the pay for fail-upward media sector executives (like Time Warner CEO David Zaslav) continues to skyrocket despite both strategic missteps and quality problems. Two, that mindless consolidation and a “growth for growth’s sake” merger mania mindset is only accelerating all these problems.

Or three, that this is all driven by Wall Street’s insatiable need for improved short-term quarterly improvements at any cost, regardless if that ultimately harms consumers, workers, or the product itself. It’s simply not good enough to provide an affordable product people really like; the need for improved quarterly returns at impossible, permanent scale inevitably results in a sort of product cannibalization and destructive performance art (see: the AT&T Time Warner Discovery mergers) that’s not really subtle.

Companies can mitigate this erosion if they’re in sectors where there’s still subscriber growth to be had or if they’re able to expand into additional business opportunities. But streaming subscriber growth has hit a wall, and there’s nowhere else to really go if your product is quality film and television.

So instead we get more creative ways to be annoying and nickel-and-dime customers for ever-sagging product quality. This results in an enshittification cycle that absolutely will drive more users to either free services (Twitch, TikTok, YouTube) or piracy, at which point streaming executives will blame everything (younger generations! VPNs!) but their own choices.

It’s exactly what cable TV executives did. And many of those folks now work in streaming, having been financially incentivized every step of the way to have learned nothing from the experience.

Filed Under: competition, consumers, enshittification, prices, streaming, tv, video
Companies: disney, netflix, warner bros. discovery

Warner Bros CEO Zaslav Sees Big Opportunity For More Pointless Media Consolidation Under Trump 2.0

from the merge-ALL-the-things! dept

Fri, Nov 8th 2024 05:33am - Karl Bode

We’ve well established that the AT&T–>Time Warner–>Discovery series of media mergers were some of the dumbest, most pointless “business” exercises ever conceived by the extraction class.

The utterly senseless saga burned through hundreds of billions in debt, saw more than 50,000 people lose their jobs, killed off numerous popular brands (like Mad Magazine and HBO), created oceans of animosity among creatives, and resulted in a Max streaming service that’s arguably dumber and of notably lower quality than when the entire expensive gambit began.

The brunchlord in charge of much of that dysfunction, Time Warner CEO David Zaslav, has seen absolutely zero accountability for this chaos, and, in fact, has been broadly rewarded with a series of massive compensation packages that in absolutely no way reflect his competency.

Zaslav, like most media execs in streaming, is all out of any sort of original ideas. And the kind of stuff that truly pleases customers (low prices, higher quality, improved customer support, better feature sets) costs money and erodes quarterly earnings.

The streaming market has also hit a subscriber growth ceiling, so they’ve shifted to more “creative” ways to please Wall Street, like more and more ads, endless price hikes, weird new restrictions, and a crackdown on password sharing; you know, all the annoying stuff traditional cable did that ultimately resulted in a collapse of the industry at the hands of streaming and piracy.

But execs like Zaslav have also been banging the drum for more pointless media industry consolidation for a while. Such consolidation generates some nice tax cuts and a short-earned stock valuation bump, but has been generally proven hugely corrosive to media diversity, consumers, labor, and product quality.

Biden’s tendency toward antitrust reform and a more skeptical take on big mergers is, of course, now dead as a doornail with Trump’s victory. And Zaslav, unsurprisingly, sees this as a big new opportunity for more disastrous industry consolidation.

When our consolidated media covers it, like this Hollywood Reporter piece, they can’t be bothered to make a single reference to the documented fact that such consolidation harms markets, consumers, workers, or product quality. In fact, they can’t even be bothered to mention that Zaslav himself just oversaw one of the most hated and destructive media mergers in recent history.

Instead, such “reporting” mostly just involves parroting what Zaslav said on an earnings call:

“Discussing “outright consolidation of an industry that is in a generational disruption” during the company’s third-quarter earnings conference call on Thursday, Zaslav said: “We have an upcoming new administration. It’s too early to tell, but it may offer a pace of change and an opportunity for consolidation that may be quite different, that would provide a real positive and accelerated impact on this industry that’s needed.”

Trump’s last administration pretty mindlessly rubber stamped big mergers in telecom and media without even seeing the details, and his “antitrust enforcers” even personally helped companies justify harmful mergers using their personal phones and email accounts. Trump’s FCC also took a hatchet to what was left of media consolidation limits, primarily to help right wing propaganda shop Sinclair Broadcasting.

The Trump DOJ did sue to thwart the AT&T Time Warner merger, but it was found later that it was because he wanted to hurt CNN and help Rupert Murdoch, not because of any actual interest in the real-world harms of the deal. Trump and his cult have convinced rubes that they care about media consolidation; but what they care about is protecting and amplifying right wing and corporatist propaganda posing as news. Anybody believing otherwise has a head full of cottage cheese.

Now that Biden and Lina Khan are no longer caring about antitrust reform or merger scrutiny, the mergers are going to get stupid. Particularly in sectors already dismantled by consolidation like media and telecom.

It’s not difficult to predict streaming’s next chapter under Trumpism, because most of the executives came over from cable TV, where they were financially incentivized to learn absolutely nothing from history. At every step of the way, the high costs of this dysfunctional pseudo-productive performance art is inevitably borne by either lower level workers or customers.

So streaming’s next phase will involve a lot more mergers, creating oceans of debt, resulting in higher prices, layoffs, and even worse quality. Consumers will then flock back to piracy, at which point all the regulators and companies responsible for the mess will blame everything but themselves (Gen Z! VPNs! The dastardly wokes!), and the cycle will repeat itself all over again as streaming gets disrupted in turn.

Filed Under: consolidation, david zaslav, donald trump, media consolidation, mergers, streaming, video
Companies: warner bros. discovery

Warner Bros. Still Cutting Off Harry Potter’s Nose To Spite His Face

from the no-fun-zone dept

It shouldn’t be news to any regular readers here that Warner Bros. has been a ridiculously jealous protector of all things intellectual property when it comes to the Harry Potter franchise. Harry Potter themed fan festivals? That’s banned magic, according to Warner Bros. Want to make a parody condom called “Harry Poppers”? Here comes Warner Bros. to kill the mood. A non-profit dinner with a Harry Potter theme, mostly to make a mother’s daughter happy? The Warner Bros. did its dementor thing to shut down all that joy.

Now, what should be obvious in all of those examples is that this all works against the interests of Warner Bros., the publishers of the books, and J.K. Rowling. After all, does anyone really believe that these fans showing off their fandom, gathering to celebrate the Harry Potter franchise, in any way is a threat to sales of these books and movies? Of course not! If anything, they build upon the Potter community and serve as an interest multiplier that can’t possibly do anything but drive more interest in the books and films.

Like a library that put together a Harry Potter program for children, only to have it threatened out of existence by Warner Bros.

It’s a sad day for little witches and wizards in Jackson Hole. The Teton County Library’s (TCL) slate of Harry Potter programming has been canceled due to copyright infringement. TCL announced the news on Wednesday, Oct. 2. TCL said it had received a cease-and-desist letter from Warner Bros. Entertainment Inc., which owns and controls all things Potter.

“Prior to receiving the letter, Library staff was unaware that this free educational event was a copyright infringement,” TCL’s announcement reads. “In the past, libraries had been encouraged to hold Harry Potter-themed events to promote the books as they were released.”

While other festivals have attempted to rebrand to generic names and themes to get around all of this, the library in this case isn’t bothering. It’s just shutting the whole thing down. And while the library is making conciliatory noises about respecting the intellectual property of others, this is completely idiotic.

Precisely what about a library building some programming around children’s love for Harry Potter represents any kind of threat whatsoever to Warner Bros.? I’ll wait, while someone tries deperately to grasp enough straws to formulate an argument for this. But really, don’t bother. This is protectionism for the sake of protectionism.

And it’s incredibly shortsighted to boot. The fans who grew to love the Harry Potter universe have grown up and now have children of their own. And that new generation could be loyal Potter fans too, if Warner Bros. would let them. Instead, the company appears far more interested in shutting down what are essentially entry points of interest for an entire new generation of potential fans and customers.

It appears Harry Potter will no longer have a nose, with Warner Bros. having cut it off to spite his face.

Filed Under: copyright, culture, fair use, harry potter, kids, learning
Companies: teton county library, warner bros. discovery

CNN Seems To Think Annoying Paywalls Will Save It From Irrelevance

Wed, Oct 2nd 2024 05:33am - Karl Bode

CNN, like most cable news networks, professes to provide users access to journalism. Instead, what you’ll most consistently find is a sort of generic drivel with the rough edges (read: truth) sanded off. On any given day you’ll find a rotating parade of lazy “view from nowhere” journalism that doesn’t inform so much as it tries to present a sanitized, corporate-friendly, apolitical platter of feckless mush.

Under Time Warner CEO David Zaslav the problem has become particularly dire. Zaslav is the sort of fail-upward media brunchlord that has no real new ideas for media. His relationship with all Time Warner properties in the wake of the disastrous AT&T and Discovery mergers has been purely extractive. He’s obsessed with tax cuts and mindless consolidation, not product quality or the public interest.

So like most Time Warner properties (see: HBO), CNN quality has suffered. The channel routinely throws fat six figure contracts at some of the least remarkable thinkers in media. Like many modern major outlets, CNN’s “both sides” approach to journalism loses the truth in an illusory quest for fake objectivity (Academics like NYU’s Jay Rosen or UPenn’s Viktor Pickard have discussed this all at length for years).

Outlets like CNN, financially disincentivized from real introspection, have responded to this sort of criticism poorly. Instead of producing more courageous journalism, they’ve repeatedly doubled down on bad ideas. Like this week, when CNN announced it would soon be erecting a new paywall. Under CNN’s new plan, the news outlet will begin asking some readers to pay $3.99 a month to access articles:

“Starting today, we are asking users in the United States to pay a small recurring fee for unlimited access to CNN.com’s world-class articles,” Alex MacCallum, CNN’s executive vice president of digital products and services, wrote in a memo outlining the plan.

The problem is that most of what CNN offers isn’t anything close to what you’d call “world class” journalism, insight, or analysis. Like many outlets CNN can accomplish decent journalism. But the lion’s share of the company’s content feels like it’s been pumped out of a dystopian nightmare built by dullards, peppered with unlimited advertisements for new pharmaceuticals and their assorted side effects.

We’ve discussed repeatedly how erecting a paywall may feel like the right idea for cash-strapped outlets, but it’s generally not conducive to journalism or democracy. And if an outlet is going to paywall, it needs to be delivering exceptional content you can’t really get anywhere else. That’s not really the case with CNN, which has been the poster child for terrible U.S. election season political journalism.

You can’t just take the charmless garbage produced by the highly consolidated engagement and infotainment economy and slap a paywall on it to increase its value. That’s simply not how any of this works.

Over the last four months in particular, we’ve seen growing animosity at the terrible, feckless election season coverage of major outlets, be it the New York Times, Axios, Politico, or CNN. Most major outlets have demonstrated the harms of letting media consolidate into the hands of wealthy brunchlords, who seem to enjoy normalizing and “sanewashing” a rising and radical authoritarian threat.

The idea that paywalls and price hikes are the answer to the problem of sagging quality and industry consolidation suggests executives still can’t really see why their outlets’ reputations are in the toilet. Which is why they’ll continue to be disrupted by direct-to-consumer newsletter authors and smaller independent media outlets with a healthy fixation on their audience and the actual truth.

Filed Under: journalism, paywalls
Companies: cnn, warner bros. discovery

Marvel, DC Lose ‘Superhero’ Trademarks After Failing To Respond To Cancellation Petition

from the super-duper dept

We have a hero in our midst, one that is responsible for freeing up the term “superhero” from its previous trademark imprisonment. If you don’t recall, Scott Richold is a British comic artist who produces the Superbabies line of comic books. Richold applied for a trademark for his comic only to find it opposed by both DC and Marvel. The two companies jointly held 4 trademarks to the term “superhero” and variations of that term. And if that strikes you as plainly absurd, given that the “superhero” is the name of an entire genre of fiction across many mediums, you’re certainly not alone.

As a result, Richold petitioned the USPTO to cancel those four trademarks, arguing that the terms have become generic. As detailed in a follow up post, I figured there were several ways that DC and Marvel might respond to the petition. They could have fought it, deploying a hefty legal war chest to try to simply bully Richold out of his attempt. Or they could have amicably released their marks, generating some amount of goodwill within the public. But I didn’t expect the companies to simply fail to respond to the petition entirely, which is exactly what happened.

As a result of the failure to respond, Richold moved for a default judgement, which would free the “superhero” term from trademark status and move it into the public domain. And, admittedly, to my surprise, the TTAB granted the default judgment.

A U.S. Trademark Office tribunal has canceled a set of “Super Hero” trademarks jointly owned by comic giants Marvel and DC at the request of a London-based comic book artist, according to a Thursday order.

The USPTO’s Trademark Trial and Appeal Board ruled for S.J. Richold’s Superbabies Ltd after Disney’s Marvel and Warner Bros’ DC did not file an answer to Superbabies’ request to invalidate the marks.

Interestingly, and somewhat frustratingly, the DC and Marvel sides of this equation aren’t responding to requests for comment. As a result, whether this failure to respond was part of a cost-saving plan in which the companies wouldn’t rack up legal fees for responses to what it knew would be a losing battle is unknown. Several commenters in previous posts suggested that might be what went on here, but we just don’t know. I would be surprised if that was indeed the case, but since most everything about this whole thing has surprised me so far, I suppose it’s possible.

But whatever the reason for the inaction on the part of DC and Marvel, the end result is that the term “superhero” and its variations are free once more for use across the different entertainment mediums.

Superbabies attorney Adam Adler of Reichman Jorgensen Lehman & Feldberg said in a statement that the ruling was “not just a win for our client but a victory for creativity and innovation.”

“By establishing SUPER HEROES’ place in the public domain, we safeguard it as a symbol of heroism available to all storytellers,” Adler said.

As it probably always should have been. Not all heroes wear capes, as the saying goes, so today we salute Scott Richold.

Filed Under: scott richold, superhero, superheroes, trademark, ttab, uspto
Companies: dc comics, disney, marvel, marvel comics, superbabies, warner bros. discovery

Warner Bros. Copyright Striking Reactions To The ‘Minecraft’ Movie Trailer

from the video-blocked dept

Of all the ways that content creators use copyright to strike down content, one of the most befuddling is when trailers are the subject of copyright strikes. There is occasionally some logic to these sorts of strikes. Trailers that are unfinished, for instance. But even when trailers leak early in a finished state, copyright holders use copyright to take those down.

But the point of a trailer is to serve as an advertisement for the content. Everything else being equal, content creators should absolutely want those trailers to be watched as far and as wide as possible. Even leaked trailers, or unfinished trailers, are still capable of building buzz for a film or show such that their proliferation should be desired.

That’s what makes it so head-scratching that Warner Bros. apparently copyright claimed some reaction videos to their Minecraft trailer.

Minecraft is going through a tough time as the much-anticipated live-action movie trailer was not well received by the fans of the game. The teaser trailer was released recently and created much discussion amongst players. They were disappointed at how everything looked.

And since this created a lot of discussion, many popular creators expressed their dislike towards the movie. One of them was Mumbo Jumob, who is among the largest and most loved Minecraft YouTube creators. A Reddit user named CaptainRelyk shared a screenshot showing how the creator got a copyright claim on their video which was titled “The Minecraft Movie Trailer looks silly.”

That video was taken down briefly after a copyright claim was made on it by Warner Bros. It is back now, with Mumbo Jumob indicating that it was claimed automatically, but that it’s been resolved.

Now, every indication is that this was done through an automated system, rather than anyone making a copyright claim on the video manually. But all that tells me is that Warner Bros. is very bad at the internet and using it to market their forthcoming film. And, because there wasn’t a highly visible public statement from Warner about all of this, the natural speculation is that the company didn’t want people to see the video out of concern it was critical in nature. That doesn’t appear to be the case, but once the rumor mill starts rolling, it’s hard to stop.

More bizarre is the second of the copyright strikes, which was done on a video made by PhoenixSC. That video didn’t even include the movie trailer, but instead included bits from a parody fan film made several years ago. And, even more strangely, the notice appeared to claim copyright on a song that nobody seems to think Warner actually has the rights to.

Another mistake? Perhaps. But Warner should be better at this, or else it should ease off its copyright enforcement practices until it gets its act together.

Filed Under: advertising, copyright, minecraft, trailer
Companies: warner bros. discovery

Time Warner Discovery Merger’s Latest Victim: Cartoon Network’s Entire Web Presence

from the masterful-mismanagement dept

Tue, Aug 13th 2024 03:31pm - Karl Bode

You might recall that AT&T’s $200 billion acquisition of Time Warner and DirecTV was supposed to transform the telecom giant into a modern internet video advertising superpower. Instead, after a massive amount of debt and endless bumbling, AT&T wound up laying off more than 50,000 people, closing a bunch of popular brands (like Mad Magazine), and selling what was left to Discovery.

The executives at Discovery have proven no less bumbling, and after firing more people and ruining a bunch of additional services (like HBO), the company saw its stock tank last week after having to take a $9.1 billion write down on the value of its entire TV division.

Like other mindlessly merging media monstrosities completely out of ideas (Paramount/CBS is engaged in similar cannibalization), Warner Bros Discovery is now looking to miraculously cut costs to reduce massive debt created by its pointlessly doomed merger.

At Paramount, that meant the complete erasure of both Comedy Central’s online footprint and the entire MTV News journalism archive. At Warner Bros Discovery, that most recently meant the deletion of Cartoon Network’s entire online presence (without any warning, we should add):

“Warner Bros. Discovery this week pulled the entire contents of cartoonnetwork.com offline — redirecting visitors to a landing page on Max, its subscription-streaming service, encouraging fans to sign up to watch their favorite Cartoon Network shows. The shuttering of the site appears to have happened Thursday, Aug. 8.”

At the same time users are losing features and history, Max is slathering their products with new ads and restrictions, while endlessly raising prices on a streaming product that’s of lower quality than before the entire saga began.

These mergers were supposed to usher forth a wave of amazing synergies and create a new media juggernaut. Instead they’ve resulted in just endless annoyance and chaos. And the executives in charge of them, like fail upward Time Warner brunchlord David Zaslav, saw accountability in the form of massive compensation packages utterly untethered from any sort of actual competency.

These brunchlords are purely extractive; they don’t care about customers, employees, history, or much of anything else. After mismanaging their companies through the cord cutting revolution they’re looking for quick mergers, a short-lived stock boost, a tax break, and a fat payout before they’re off to the next company to do the same thing, financially incentivized to learn nothing from experience.

Their mismanagement is treated by the business press not as bumbling incompetence, but as some kind of cold but cleverly necessary mathematics. All the problems are somehow caused by ambiguous externalities. Whether pointless consolidation at the hands of raging incompetents is at the heart of the problem isn’t even something most in the business press feels its within their purview to contemplate.

Filed Under: brunchlord, cartoon network, comedy central, cord cutting, media, mtv, streaming, video
Companies: cartoon network, warner bros. discovery

After Layoffs And Endless Chaos, The AT&T, Time Warner, Discovery Mergers Come To A Whimpering, Pathetic Finale

from the merge-ALL-the-things! dept

Thu, Jul 25th 2024 05:27am - Karl Bode

The utterly pointless, decade-long madness that was the Time Warner Discovery series of mergers has come to its pathetic conclusion. Basically announcing that the whole mess was a waste of time, company executives last week quietly announced they’d be untangling much of the partnership and try to pretend the whole thing never happened:

“The theoretical plan, as best as I can understand from the FT report, is to turn Warner Brothers Discovery into one “Goodco” — its (formerly known as HBO) Max streaming business and its Warner Bros. movie studio — and one “shitco” — all of its declining linear TV networks, including CNN, plus most or all of the $40 billion in debt WBD has taken on.

…the biggest takeaway is the seeming admission behind the trial balloon: That the WarnerMedia-Discovery deal — pitched at the time as a way to scale up to fight Netflix and Big Tech companies — hasn’t worked.”

These mergers were supposed to usher forth a wave of amazing synergies and create a new media juggernaut. Instead they resulted in madness and chaos. And the executives in charge of them, like fail upward Time Warner brunchlord David Zaslav, saw accountability in the form of massive compensation packages utterly untethered from any sort of actual competency.

It all began with the AT&T Time Warner and DirecTV mergers, which were a monumental disaster. AT&T spent $200 billion to acquire both thinking it would dominate the video and internet ad space. Instead, the company lost 9 million subscribers in nine years, fired 50,000 employees, closed numerous popular brands (including Mad Magazine), and stumbled around incompetently for several years before giving up.

But that was just the start.

After its tactical retreat, AT&T spun off Time Warner into an entirely new company, Warner Media. Warner Media then immediately turned around and announced a blockbuster merger with Discovery, resulting in the super-creatively named Warner Brothers Discovery.

Things only got worse. Executives there were so cheap they refused to pay residuals to creators, shuttered numerous popular programs they didn’t want to pay for, and engaged in round after round of additional layoffs to achieve promised “synergies” that never arrived. Hundreds of billions of dollars later and the end result is a shittier product and absolute chaos.

The whole mess is a wonderful example of the blistering stupidity of the “growth for growth’s sake” mindset, the perils of mindless consolidation, and our obsession with pointless megadeals that only benefit investors and higher level executives in the form of tax breaks, brief stock bumps, and outsized compensation package.

Everybody else, from artists and employees to consumers, gets screwed in the form of layoffs, higher rates, or lower quality product. It’s not clear how many times we have to repeat the process before we learn anything, in part because there’s no financial incentive for introspection by decision makers.

Filed Under: consolidation, david zaslav, growth, media, mergers
Companies: discovery, warner bros. discovery, warner brothers

Bumbling Time Warner CEO David Zaslav: What U.S. Media REALLY Needs Is More Mindless Consolidation And Deregulation

from the fail-upward-to-the-level-of-your-incompetency dept

Mon, Jul 15th 2024 05:31am - Karl Bode

By now we’ve well established that the AT&T–>Time Warner–>Discovery series of media mergers were some of the dumbest, most pointless “business” exercises ever conceived.

The brunchlord in charge of much of that dysfunction, Time Warner CEO David Zaslav, has seen absolutely zero accountability for this chaos, and in fact has been broadly rewarded with a series of massive compensation packages that in absolutely no way reflect his competency.

Growth For Growth’s Sake

Last week the media industry announced yet another merger, with Paramount and Skydance the latest to tie the knot. The new company will be overseen by Larry Ellison’s son David, who received a $6 billion gift from dad to make the merger possible. Paramount had struggled with its ingenious strategy of charging higher and higher rates for lower and lower quality services, and eyed a merger as an executive escape hatch.

The Paramount Skydance merger is notably smaller than the Time Warner Discovery mess, but it still represents the media sector’s obsession with mindless consolidation. Consolidation that generally exists to (briefly) boost stock valuations, provide rich men tax cuts, and justify excessive compensation packages for fail-upward brunchlords easily impressed by their own savvy deal making abilities.

The king of those brunchlords, Zaslav, of course was bullish on the merger in comments to Bloomberg, despite companies making it very clear the deal will result in even greater layoffs and cuts. Talking about Paramount and the upcoming Presidential election, Zaslav proudly proclaimed that what the media industry really needs is a President who’ll embrace mindless consolidation and deregulation:

“We just need an opportunity for deregulation, so companies can consolidate and do what we need to to be even better.”

Again, this is a guy who just oversaw one of the most destructive and pointless consolidation efforts in modern media, with a company born from pointless consolidation, feckless antitrust enforcement, and mindless deregulation (AOL Time Warner). Bloomberg, and other major outlets reporting on his comments, apparently didn’t think that was useful historical context.

Media consolidation almost always ends badly for everybody other than executives. The huge debt loads created by such deals are always compensated by massive layoffs, quality control erosion, and higher prices for consumers. The consolidation also steadily drowns out independent and diverse media voices, resulting in a sort of bland homogenization that has very clearly now extended to streaming.

Media Consolidation Matters, And Both Parties Tend To Suck On Media Policy

This is all made possible, in part, by our steady erosion of any sort of media consolidation oversight. Recall the Trump FCC took an absolute hatchet to what’s left of media consolidation rules. And while it did oppose the Time Warner Merger (and failed), it did so as an anticompetitive favor for Rupert Murdoch and a middle finger to CNN, and not out of any legitimate worries about consolidation.

Democrats also have no real media policy, rarely think media oversight is really worth pursuing, and routinely also rubber stamp pointless mergers (like the Time Warner Discovery deal in 2022). They’ll at least occasionally give a nod toward the need for some guardrails, but it’s never a policy arena they’ll pursue with any real zeal, despite consolidation and propaganda’s clear impact on an informed electorate.

I like to play a little game every time there’s a major merger news cycle (whether gaming or media or tech). I like to head to Google News, read the first ten articles on a particular merger, and see how many — if any — can be bothered to point out that these deals almost always wind up harming employees and consumers. And how many can reference any history of empty promises related to past deals, often involving the exact same executives and companies.

There are thousands of academics and experts on media consolidation and merger mania that a reporter could talk to in order to flesh out their stories. There are ample, very recent examples of how these kinds of deals are generally a pointless dumpster fire that exclusively benefit the richest executives. Yet not only are these experts not asked to comment, these issues aren’t raised at all. Anywhere. Even as context.

These are the kind of business reporters who’ll lecture young industry upstarts endlessly about bias and ethics, yet genuinely can’t (or won’t) see how their relentlessly pro-business, pro-mindless deregulation framing of stories is dictated by billionaire ownership and consolidation, and routinely leaves readers painfully (and often intentionally) uninformed about the real-world impact of major business choices.

It gets especially ridiculous when media reports on itself. FOX, CBS/Paramount, ABC/Disney, NBC/Comcast) have all been pushing the FCC to eliminate restrictions and consolidate further in a bid for reduced competition and endless homogenization. Combine it with the rise of a very effective and well funded right wing propaganda ecosystem, and you’ve got yourself a real recipe for “success.”

Filed Under: antitrust, competition, david ellison, david zaslav, diversity, fcc, larry ellison, media, media consolidation, media policy, mergers
Companies: paramount, skydance, warner bros. discovery

‘Max’ Again Hikes Streaming Prices As Customers Head For The Exits

from the higher-prices-for-a-shittier-product dept

Fri, Jun 7th 2024 05:34am - Karl Bode

Now that streaming subscriber growth has slowed, we’ve noted repeatedly how the streaming TV sector is falling into all of the bad habits that ultimately doomed traditional cable TV.

That has involved chasing pointless “growth of growth’s sake” megamergers and imposing bottomless price hikes and new annoying restrictions — all while simultaneously cutting corners on product quality in a bid to give Wall Street that sweet, impossible, unlimited, quarterly growth it demands.

Warner Brothers Discovery ‘Max’ Streaming service has been the poster child for this dysfunction. Born from the disastrous abomination that was the AT&T–>Time Warner–>Discovery series of pointless mergers, the service has continually gutted what made some of HBO’s original programming great, instead chasing the bottomless well of low-quality, cheaply produced, lowest common denominator, mass engagement porn.

This week Max raised prices on all of its service plans a buck or two, whether we’re talking about ad-based and or ad free versions. The company’s annual ad-free plan at 170peryearisnow170 per year is now 170peryearisnow20 more, and its Ultimate ad-free annual plan jumped 10to10 to 10to210 per year. At the same time, customers on Max’s cheaper plans lost access to several features, including 4K and HDR streaming.

This kind of stuff, where you consistently charge more money for fewer features and less quality, is what ultimately happened in both U.S. telecom and cable TV. Both sectors have perfected this approach of consistently shoving you into a pricing funnel where, if you want all the perks and features you originally enjoyed, you can expect to steadily pay more and more for them — even as overall quality declines.

But unlike traditional cable or broadband, which locks you into service either through forced bundling or (in telecom’s case) regional monopoly, customers fortunately still have the ability to cancel streaming services — assuming they don’t mind missing out on some of their favorite shows. So customers are increasingly signing up for a service, binge watching, then cancelling again.

This is, as Ars Technica observes, bad news for an industry that’s trying to give Wall Street consistent, improved quarterly returns:

“This week, Andrew Georgiou, head of WBD’s UK and Ireland business, discussed the challenge this poses for streaming companies: “Netflix is a mainstay but we are starting to see real SVoD churn, people cycling in and out at an increasing rate,” he said, per Deadline. “That phenomenon is a huge cost to business and reducing that churn, increasing engagement and reducing the cost of ‘winbacks’ is something we all need to focus on.” WBD CEO David Zaslav has called high churn rates a streaming business “killer.”

Having covered telecom and media for decades I know that this is where the industry will start making it difficult to cancel service. That will likely mean everything from simply making it steadily more difficult to find the cancel button (a la AOL or the Wall Street Journal), to finding “creative” ways to bundle services together in increasingly complicated ways (perhaps with broadband or wireless access) to minimize churn.

This will involve, like in telecom and cable, making it more and more difficult to understand what you’re paying for (was I paying for Netflix already via my promotional deal with Verizon FiOS, or was I subscribing to a Hulu plus Netflix bundle via my Disney and Charter cable cross promotion?), inevitably resulting in you paying for some services you’d forgotten completely about.

This shift will, I expect, involve more telecom and media cross mergers like the AT&T Time Warner disaster. It will also, again just like in cable TV and telecom, involve making it more difficult than ever to actually know how much you’re paying (likely via strange new hidden fees).

Ideally you’d handle customer “churn” (defection rate) by lowering prices, improving customer service, expanding innovative features, and ramping up product quality. But given that nibbles away at Wall Street’s improved quarterly earnings, the alternative is consolidation (tax breaks, huge debt loads, short-lived stock bumps) and anti-consumer creative pricing and feature set fuckery.

That opens the door to disruption by alternative tech (or piracy), starting the cycle all over again.

To be clear, I still think streaming TV holds a lot of value. Streaming customer satisfaction remains far higher than cable TV ever was. These more annoying trajectories, which you’re only starting to see emerge, will take several years to play out. But the path is pretty clearly set, thanks to executives who are utterly financially disincentivized to learn absolutely anything from cable TV’s rocky history.

Filed Under: competition, consolidation, max, mergers, streaming, tv, video
Companies: warner bros. discovery