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  • Jamie Adams

Streaming Wars: The Battle For Your Living Room

The battle for cable dominance was a costly one, but the battle for streaming market share will be even more so.

Photo by Pinho . on Unsplash

It was not that long ago that cable television companies were fighting for control of the American living room. Those days have since passed, however, as a new storm brews. Plans are made, battle lines are drawn, and the streaming giants prepare to go to war for market dominance and your subscriptions. Welcome to the future of home entertainment; it will not be pretty!


Competitors

The most popular name in direct-to-consumer media distribution is without a doubt Netflix (NASDAQ: NFLX). Amazon Prime (NASDAQ: AMZN) and Hulu have been the only real rivals during its rise in recent years, but even they struggled to gain the same market share. Now, however, the leaders face more competition in the form of Apple TV Plus, launching in September and the arrival of a new behemoth in the form of Disney+, the House of Mouse’s new streaming service to be released in November. 


Disney (NYSE: DIS) is a long-established media creator with almost a century's worth of content which it can rollout, as well as plans to expand the likes of the Marvel Cinematic Universe and Star Wars galaxy with original content T.V. shows. With one of the world's biggest media fan-bases, lower prices, massive resources and an archive of original content, it will be tough to look past Disney as the biggest threat to Netflix’s crown.


With so much competition, Apple (NASDAQ: AAPL) may have a hard time grabbing a substantial market share, as they found when taking on Spotify (NYSE: SPOT) with Apple Music. They do have some cultural roots in television and film, however. When the late, great Apple co-founder Steve Jobs was interviewed for his biography, published shortly after his death in 2011, he revealed that in regards to television he believed he had "finally cracked it". Jobs himself was once the outright owner and operator of Pixar, and following their acquisition by Disney in 2006, became the largest single shareholder of Disney, owning over 7%.


If Jobs’ vision for television was followed through into Apple’s upcoming streaming service, they may just have a winning formula on their hands. As the second most cash-rich company on the planet, Apple has an enormous war chest to work with, which they can use to create huge amounts of original content. In a world where people are less inclined to spend upwards of $1000 on smartphones, it may well be time for the company to shift their focus on services such as this. 


Pricing Battle

As the two biggest newcomers, Disney and Apple have it all to prove with their new services. However, cost is going to be the biggest factor for customers after available content. 


Disney will launch their new service at a base price of $6.99, or in a bundle which includes Disney+, Hulu and ESPN+ for $12.99 per month. Netflix increased their prices earlier this year to $13 for their basic package, much to the annoyance of their subscribers, while HBO’s upcoming streaming service HBO Max is rumored to cost around $17 a month. 


With Apple yet to unveil their service cost, and other streaming firms coming in at similar prices to Netflix, Disney+ is currently the cheapest streaming service which will be on the market. 

This may seem like bad news for other services (especially Netflix), but the Disney+ bundle, though available internationally, may not be as coveted outside of the United States with many other countries having less interest in ESPN+ or Hulu. This means that many may stick with Netflix or simply subscribe to both. 


The Outcome

It is too early to say how all this will pan out, but there are sure to be some cuts and bruises in this upcoming fight. One business that will most likely benefit from all of these choices however, is provider-agnostic devices such as Roku (NASDAQ: ROKU) or Amazon Fire Stick. 


Roku allows customers to purchase a device which can have access to every different streaming service, meaning that will all be in one place. Amazon Fire Stick is similar, but with so much competition, Amazon may reconsider their stance on allowing competitive streaming services on their devices. 


It is unlikely that the competition between all of these streaming platforms will outright “kill” any of these competitors, especially among the bigger companies, but it is sure to be a scrappy affair. As it stands, it would be very hard to dislodge Netflix from the top of the pile, but stranger things have happened. 2020 may be a defining year in the future of media consumption.


MyWallSt operates a full disclosure policy. MyWallSt staff currently hold long positions in Amazon, Apple, Disney and Netflix. Read our full disclosure policy here.

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