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TIMO ZIMMERMANN

balancing software engineering & infosec

Thoughts on video on demand, Netflix and the revival of piracy

posted on Saturday 17th of August 2019 in

Netflix did not really hit their subscriber goal. I actually do not particularly care if the reasons outlined in this article are correct, but I really care about video streaming. And I sadly see the whole thing going downhill so fast that I am waiting for news about „Pirate Bay 2.0 and limewire X“ – our old timers showing up in some new form – bringing back the golden age of piracy.

I am a Netflix subscriber since they expanded to Germany, so somewhen around 2014. 5 years I paid them every single month, the whole family membership, the largest package for the highest quality they can offer. And I am okay with that.

I did not own a TV for nearly a decade and watched all content on my laptop. This worked quite well, until two things happened: Netflix and my wife. So we got a TV. And an AppleTV. All our content on a nice big screen, and I already had a proper speaker system, so this was all setup pretty fast. We started enjoying shows on a 65“ screen instead of a 15“ laptop. Talk about an upgrade. But we still do not have cable or satellite, Netflix and iTunes are our primary sources for movies and TV shows.

My wife sometimes watches the online service of some garbage German TV channel which we are forced to pay for if we want it or not. (It is an astonishingly stupid and people hostile system no one managed to drag through the courts yet…) And last week we bought a movie on Amazon Prime. Not because I like Prime Video – if I would have to pay for it, it would not be available, but hey, it is „free“ – but because iTunes did not have the original dub available.

Recently I started paying for YouTube Premium too, since I am actually watching more YouTube than Netflix and I like some of their shows. Being able to pay instead of being forced to watch ads is exactly the business model people ask for in many online debates around ads, privacy and sustainable business models. I still got a ton of shit for „supporting Google“ and „paying for something I could have for free using $x“. Guess what, this mentality is why we have an ad and privacy-depraved online experience.

For five years all seemed pretty good to me. Then the entertainment industry happened. Everyone wants a piece of the streaming and VOD cake, so Disney started Disney+ for example, with exclusive content. But not only exclusive new content they produce, they also simply remove existing movies and shows from Netflix.

If you look at the larger landscape of upcoming and existing streaming services there is a good chance you will end up in a world where you pay $60-$80 per month, likely even more, to have access to all content.

Obviously people are slightly upset that streaming costs increase by 6-8x per month. We can have a pretty lengthy discussion if the price is actually justified. I subscribe to the theory that the studios and produces can charge whatever they want, if I am willing to pay it is up to me. If I do not consider content worth the price I simply do not consume it. Shows and movies have quite large production costs, so drawing parallels to music does in my opinion not really work out well. In the music industry you also have some alternative income channels like live tours. I mean, I think I would really enjoy seeing Vin Diesel, The Rock and Jason Statham performing a live version of Fast & Furious, but likely „for the lolz“ and not for entertainment value.

But it is not only about cost. With 6-8 streaming sources you will likely be forced to have 6-8 different accounts to manage, 6-8 different applications, one less usable than the other and 6-8 places to search to find the content you are interested in. Apples TV app is trying to streamline this, but as companies still believe in locking users into their shitty experience – hello Twitter – I do not see the TV app being a viable solution in the long run.

With the current developments, there is actually no way forward I see that will serve customers well.

If we have to have multiple subscription based providers a centralized app for consumption would be huge, but is likely not going to happen.

Content being available on all platforms is obviously the best solution, but is likely not going to happen.

A true VOD system where I pay $x to a provider of my choice for the content I want to see, is maybe going to happen. The individual content providers can name their price, but at the same time they do not want a one time payment, but a subscriber.

Remember what happened the last time content was stupidly expensive and inconvenient to access? Piracy. And I can see it happening again considering all the hurdles and money multiple streaming services would bring and cost.

In a small corner of the Internet I can now hear some people scream „ALL CONTENT HAS TO BE FREE“ or „we could pay $10 per month to a central place and they sent $0.01 to content providers which content we consumed“. Take a guess why there are so many shows and movies – because it is a lucrative business. Not going to happen and an absolute stupid idea that is not contributing anything to solving the problem at hand.

At this point I am fairly certain we will actually not be solving the problem, but time will. New platforms with launch, people will subscribe and at some point drop because they do not get enough value for what they pay. At this point prices either will drop or content will be distributed via more channels again. Some platforms like Disney+ have enough money to take a very long time before this happens, but in a few years we will likely only see one or two streaming platforms.

Since this is not a problem I can solve, the only thing left for me to do is figure out what I will be doing in future.

I find myself watching a lot less Netflix lately. New shows which receive a lot of hype simply do not give me a lot. I can watch them, but it is not like I would binge them, a good sign I could live without them. On the other hand I am watching more and more YouTube and Twitch. Especially DIY, gaming and tech channels. To me Netflix is at a point where it is not worth the 15€ per month anymore.

If I really like a show or a movie I usually buy them via iTunes since I will watch them many, many times and I am okay spending a few € for the entertainment value I get out of them. And considering I might have to pay 60-80€ in future, I can buy a few movies and a show per month, not pay anything extra and not hope they are still available when I want to rewatch them.

I do not like the fact that there is DRM in play and that I do not own the media, but that is a trade off I decided to live with for the convenience of having media accessible with one click. Going back to buying things on spinning discs is not really an option for me, there are just too many drawbacks for the impression of ownership.

The entertainment industry is setting themselves up for a stupid battle that will cost them a lot of money and customer satisfaction for some short term profit and a chance at being the winner of the whole streaming and VOD game in a few years. Let us prepare some popcorn and see where this goes, it might be more entertaining than some recent shows.