The current dynamics of the streaming industry highlight the difficulties that characterize this moment of transition.

The streaming services industry, once fertile ground for unprecedented growth, is now facing a challenge never seen before: a wave of subscription cancellations that is mainly affecting the giants of the sector, with significant repercussions also on the production of most loved TV series. The crisis, as always happens in these cases, is the result of the combination of various factors.

The streaming industry is in a moment of great crisis – Sjbeez

First of all, it must be taken into consideration that, in recent years, the number of streaming services available has exploded, exceeding one hundred in the United States alone. This abundance of choice, while it may seem like a benefit to consumers, has actually led to extreme fragmentation in the industry, with many users choosing to subscribe to fewer or no services at all. The factor that most influences, in fact, is obviously that of costs.

Streaming services are navigating very turbulent waters

The growing competition and the consequent desire to create high-quality content has caused production costs to skyrocket, forcing platforms to revise subscription prices upwards. This increase, however, has not been welcomed by the market, which is starting to show signs of tiredness and resistance to the rising tariffs.

The future of streaming is increasingly uncertain, between high costs and subscriptions in crisis – Sjbeez

The situation of Disney+, which has lost a significant amount in terms of operating income (it is said to have lost $1.1 billion in 2023 alone), vividly illustrates the financial difficulties resulting from these market dynamics.

Faced with these challenges, streaming platforms are called to innovate not only in content but also in business strategies. It was recently announced, for example, that Disney Plus will put an end to the possibility of password sharing, exactly as many of its rivals have already done.

Another emerging strategy is the introduction of ad-supported plans, which offer a less expensive alternative to premium subscriptions. This model, successfully adopted by Netflix at Hulu, could represent a sustainable long-term solution to attract and retain price-sensitive subscribers.

According to many analysts, these are solutions that, in the long run, will not be sufficient for many of the smaller companies. If this prediction is true, one of the possible scenarios is a period of market contraction, after a period of great expansion, which would see several smaller streaming services close their doors to make room for those who manage to dominate the sector.