Comcast’s $3.8 billion DreamWorks Animation acquisition and that long-baking Yahoo sale are only the latest M&A deals in digital content, part of an epic gold rush in an industry that still hasn’t figured out how to pay for itself. Amid all these eye-popping deals come some conflicting trends that inspire one big question: Has the digital gold rush just begun, or are we nearly done?
Some factors to consider:
- Peak TV? Or Peak Peak TV? Last year, FX President John Landgraf warned that networks were making more shows than people could actually watch. This year likely won’t be much different, as networks try to lock in loyal, cross-platform audiences. But the economics aren’t any prettier. Will networks’ parent companies (whose TV units have driven profits) be buying more, or retrenching?
- Peak Pay-TV? Pay-TV providers have faced concerns for a few years about too-pricey packages and the ensuing cord-cutting and soft subscriber numbers. That culminated last summer in Wall Street’s media meltdown in share prices. Where will pay-TV platforms extract the cash for further deals, if revenues plateau while networks still push for higher fees?
- Peak SVOD? SVOD streaming services are proliferating far beyond Netflix, Hulu and Amazon. Vessel, Vimeo On Demand, YouTube Red, Ellation’s CrunchyRoll, Fullscreen, HBO Go, CuriosityStream, CBS All Access, NBC’s Seeso and many others now offer monthly subscriptions. But a new GfK study suggests consumers may be reaching the limit of what they will pay for these services. They’re also getting grumpy about the proliferation of services. Will SVOD, like traditional pay-TV, soon hit a ceiling?