It’s more important than ever to keep a close eye on how streaming habits are changing as home entertainment now plays an unprecedentedly central role in consumers’ daily lives that are slowly but surely adapting to #TheNewNormal. That’s why this week’s Media Biz Report Card will touch on how streaming habits have recently changed because of COVID-19, which hopefully can provide some hints on where streaming eyeballs will go in the near future.
We teamed up with the folks over at YouGov to field a video streaming survey in late April, and grades in this week’s Report Card will be given out based on how streamers fared month over month, in addition to the various news that’s been broken about each streamer since April.
Here’s a look at how the video streamers rank among each other after taking into account what’s happened to them since April:
Netflix (A+): Streaming’s G.O.A.T., as we’ve previously dubbed Netflix, has truly had a remarkable run in the coronavirus era thus far. For one, exclusive data from the late-April survey conducted by YouGov in partnership with VIP indicates that COVID-19 may have provided Netflix with the biggest spike in usage, when comparing self-reported spikes in SVOD usage due to the coronavirus outbreak (see chart; consumers had to use each service that they answered for). Sure, actual SVOD usage boosts since the pandemic started may slightly differ, but it’s hard to believe that Netflix wouldn’t be one of the biggest beneficiaries of self-quarantining. Netflix did in late April disclose that it more than doubled its original guidance for Q1 ‘20 global sub adds, after all. It’s easy to see at least some of what might’ve caused this large self-reported increased usage of Netflix in April. At the beginning of that month, it was coming hot off of buzz for “Tiger King,” which Variety reported was one of Netflix’s biggest original shows ever. Netflix capitalized on the uncanny level of zeitgeisty-ness of “Tiger King” by adding an additional episode to the series on April 12. Meanwhile, late April demand for Netflix surely stemmed in part from “Extraction,” which dropped April 24 and was pacing to be one of Netflix’s biggest movie debuts-ever in early May. More recently in early May, shows stemming from some of Netflix’s biggest production deals surely helped drive engagement: Ryan Murphy’s “Hollywood” dropped on May 1, while Michelle Obama’s “Becoming” documentary dropped May 6.
Disney+ (A): Disney’s D2C streamer has faced criticism for being too “Mandalorian”-dependent, and it’s really made it a point intentionally or not (probably unintentionally) to silence those critics since April. For one, the company at the beginning of April announced, to the extreme dismay of the exhibitor community, that “Artemis Fowl” would skip a theatrical run and debut on Disney+ (the debut date was revealed in mid-April to be June 12). In another blow to the movie theater biz, Disney announced that its recording of Broadway mega-hit “Hamilton” will skip its originally planned October 2021 theatrical debut and drop exclusively on Disney+ in July. “Artemis” and “Hamilton” surely aren’t programming options that appeal to all Disney+ subs, but they’ll probably be reason enough for at least some consumers that were thinking about ditching Disney+ to stay. This could help Disney+ maintain its healthy sub base, which Disney revealed to count 54.5 million during its FY Q2 ‘20 earnings two weeks ago. One unintended consequence of these shifts in distribution strategies for “Artemis”/”Hamilton” is that there may become a growing expectation among some Disney+-ers to regularly receive access to Disney blockbusters as exclusives, which probably isn’t optimal for Disney to be doing long-term. No matter, big titles will contribute to boosting Disney+ user satisfaction, which was the second-highest among streamers in April (see chart below).
Hulu (A-): Hulu has been somewhat silently operating in the coronavirus era from April to date, in terms of big announcements and debacles (a good thing on the absence of the latter, to be sure). But if you’ve been playing close enough attention, the Santa Monica-based streamer has actually had a good run since April, when measured in terms of its programming drops. For one, FX on Hulu’s first streaming series “Devs,” wrapped up its first season in mid-April, and nabbed a 80%/75% critic/user score on Rotten Tomatoes. But more impressive was the reception to the Cate Blanchett-starring “Mrs. America” (Apr. 15 premier, 96%/89% RT critic/user score) and “Normal People” (Apr. 29 premier, 88%/94% RT critic/user score). Oscar MVP “Parasite” also became the most-streamed foreign language/indie film on Hulu after one week of debuting on the service in early April. The fact that Hulu’s catalog is smaller than competitors’ like Netflix means “Mrs. America,” “Devs,” and “Parasite” have more of a shot to be noticed by users browsing aimlessly than users browsing another bulkier SVOD, and those titles might have had something to do with the seven percentage point increase in U.S. adults saying they’ve used Hulu more as a result of the pandemic from March to April.
Prime Video (B+): Amazon might have had the most interesting run of the streamers in this roundup since April. At the end of April, it renewed its rights pact with the NFL, and chasing sports rights is a rare thing to do for any major U.S. SVOD (not counting vMVPDs or sports-focused streamers like a DAZN) these days. But what else is good on Prime Video is its ability to recognize and hop on two hot coronavirus era-SVOD trends: a) the need for free and b) the rise of co-viewing. Amazon last month made full HBO series like “Big Little Lies” free on its service, while it also let Twitch creators with active Prime memberships live-stream certain Prime Video content on their channels. The free HBO content could allow Prime Video to snag more data on viewership preferences that might otherwise go to streamers like Hulu, which also offered free HBO content in April. The popular streamers of Twitch could be the difference that send some consumers seeking co-viewing opportunities Amazon’s way over other platforms, like Netflix, HBO, and Houseparty, which are all also getting into the co-viewing game.
Peacock (B): After being on the market for a month, NBCU’s Peacock doesn’t seem to have seriously impressed or offended the market in any significant way. There have been some who have deemed it as not “must-see” and giving off a “half-baked vibe,” but there have been other streamers that seemed to have debuted to greater criticism, like Quibi and Apple TV+. That’s partially due to the fact that Peacock only initially had a limited rollout to Comcast customers, but also because the announcements surrounding the new NBCU SVOD to-date haven’t generated near the level of excitement that surround other new SVODs’ announcements. While Disney+ has recently announced it would early debut “The Rise of Skywalker” and “Hamilton” on its service, recent Peacock news has included its to-come cross-platform availability on Apple and Xbox devices in July, the delay of most of its originals until 2021, and that the service is exceeding internal projections for monthly users (although we, the public, don’t know what any of those numbers are). Something that could certainly boost Peacock’s market appeal is if NBCU chief Jeff Shell starts making certain Universal films bypass theatrical releases to become Peacock exclusives, like what Disney is doing with some of its films. However, this bypassing makes less sense in Peacock’s case, given the likely relatively limited audience size it has compared to a Disney+.
HBO Max (B): The last to launch of the new class of video streamers (the others being Apple TV+, Disney+, and Peacock) that were the talk of the media biz in 2019, HBO Max has reminded us how it plans to grow via aggressively chasing partnership deals and bundling. In April alone, it was announced that new AT&T TV and DirecTV customers, HBO customers via Charter, and HBO subscribers billed through Google Play will get access to HBO Max when it launches on the 27th. These deals, in addition to AT&T’s large existing customer footprint, hint that HBO Max could post big engagement numbers out-the-gate. Still, don’t get your hopes up on AT&T disclosing an HBO Max sub number during its next earnings call, as we’ve been using HBO Now’s 8 million sub count number since early 2019. Something that will be worth paying attention to once HBO Max hits the market is consumer perception on an SVOD that pitches itself as “HBO and more.” HBO Max has already taken somewhat of a beating for its recent ad that pitched itself as a destination that housed “The Sopranos,” “Friends,” and “The Big Bang Theory.” So, will attitudes toward HBO branding actually change, for the worse, if consumers can easily flip between “Game of Thrones” and “Adventure Time” on the same platform? My guess on that is probably not, at least probably not that much. A lot of consumers might not be aware of network branding as much as execs think they are, for one.
Skating by/On thin ice
Apple TV+ (C+): Apple TV+ has continued to quietly, as in a non-zeitgeist-puncturing-manner, debut originals since April, with shows like, “Trying,” “Fraggle Rock,” “Defending Jacob,” and “Home” hitting the service since then. While none seemed to have been unique or zany enough to stop the internet like a Netflix-”Tiger King” has, the Chris Evans-starring “Defending Jacob” has been a big hit among existing Apple TV+-ers. Deadline reported that the show was one of the top 3 premiering Apple TV+ originals to date. Some marquee programming could seriously change the trajectory of Apple TV+’s growth if Apple ends up securing the the right pacts, such as Scorcese’s mega-budgeted “Killers of the Flower Moon” or Pac-12 Conference sports, but those are longer-term plays. Given the fact that YouGov data indicates that Apple TV+ may have taken a big hit in viewership as a result of the pandemic (see chart below), the service would be well-served to drop something soon that has a built-in audience to boost engagement with the service. Apple’s growing stable of talent should be able to help with that later in 2020. Since last year the company has signed big names like Alfonso Cuaron (October 2019) and Julia Louis-Dreyfus (January 2020), for example. Most recently, Apple signed the production company of Ridley Scott to a first-look TV deal.
Quibi (C-): With the late April news of Quibi improperly sharing user emails with third-party ad firms and the revelation that only 1.3 million out of the 2.9-3.5 million downloads (lower end is a third-party estimate, while the higher tally is Quibi’s) that Quibi has received since launch are active users, it’s hard to justify classifying it as not continuing to skate by. Quibi’s 90-day free trial offer also ended already, which will likely make the hassle of signing up for the service and downloading the app seem less worth it in the eyes of some consumers. And while the amount of candor Quibi has exhibited to the press on its difficulties since launch is commendable, it probably isn’t inspiring confidence in creators who want to have their shows distributed to the biggest audiences to pitch to Quibi. In an interview with NYT last week, Quibi founder Jeffrey Katzenberg said he attributed “everything” that’s gone wrong with the app’s launch to coronavirus, and also expressed disappointment with Quibi’s download/usage numbers. “It’s not up to what we wanted. It’s not close to what we wanted.”