Disney is launching its own direct-to-consumer streaming service. Will other networks follow?
Key passage:
Quick sidebar: The companies that make television shows and movies aren’t always the same ones that air them. Complicated webs of dealmaking used to weave all of them together. 20th Century Fox would make shows for NBC; Universal Studios (owned, along with NBC, by Comcast) might make shows for Fox; Sony could make shows for NBC and CBS and syndication; and so on.
But now the incentives have changed. Netflix taught studios an important lesson about the afterlife of back catalogs and the value of new content. With more venues to show both, studios have more incentive to retain both creation and distribution.
Brooks Barnes @ The New York Times wrote another piece with this great insight:
For the first time in the streaming age, the world’s largest media company had decided that embracing a new business model was more important than clinging to its existing one.
Another question. How at risk is the $12b per year in subscriber fees that Disney receives from cable TV companies?
Disney makes roughly $12/month from every cable TV subscriber in the U.S.
