Lots of examples to follow, but before we get into the state of the industry, here are a few notes on what pundits and analysts were saying eight or ten years ago.
This was a subsidized narrative
The standard narrative of the streaming industry was by and large created by the industry and fed journalists who mostly accepted it without question despite numerous dubious and in some cases factually challenged claims. The discussion was heavily influenced by astounding marketing and PR budgets. Netflix alone was spending billions a year just on marketing. Disney was even more. Throw in Apple TV, HBO Max, Peacock, Paramount, Quibi, not to mention smaller players like Britbox. All of this money combined with the bubble mentality and hype economy of the teens produced a deeply distorted, narrative-based picture of the industry.
So what were the main points of the narrative?
"In the end there can be only one"
Conventional wisdom was heavily invested in the King of the Hill assumption. Within a fairly short time a front runner would emerge and from then on dominate the industry much as Google dominate search. This was very similar to what we were hearing about ride-sharing despite having even less justification in terms of barriers to entry.
Netflix was supposed to be well on its way to dominance because of first mover advantage and because it was building a content library so massive that it would not be at all dependent on the major Studios for content in a few years. This claim would have been absurd even if it hadn't actually been a lie. Each of the studios had highly valuable IP going back almost a century thanks to their lobbyist s constantly pushing back copyright protection. Add to this the constant new production and there was no way Netflix could have possibly caught up if it had even been trying, which as it turns out it wasn't, at least not at the time.
In one of the biggest and most successful lies of omission from any major company in the past couple of decades, Netflix had managed to convince virtually every journalist working east of the Mississippi and quite a few here in Hollywood that it actually owned shows like House of Cards and Orange is the New Black. In reality the company at that point wasn't buying anything. All they were doing was acquiring exclusive distribution rights for 5 or 10 years. Basically they were pulling the old scam of convincing investors they owned what they were merely renting. Eventually, word got out and Netflix started acquiring rights to some, though not all, of their originals.
Perhaps the most remarkable aspect of this part of the story is that the journalist s who had been made fools of for years didn't seem to mind.
In addition to having what was soon to be the most valuable content library in the industry, Netflix also had an insurmountable lead both in the amount of data and in their ability to harness it. Lots of cracks in this claim as well, some going back for years.
No one uses old tech
Another popular theory claimed that the studios had screwed up, perhaps fatally, by allowing Netflix to license their properties like Friends, Seinfeld, etc. for billions of dollars. The end result would be that Netflix had better established its brand while the properties would be far less valuable than they would have been had the studios held them out of circulation. (This of course runs counter to everything we know about this kind of intellectual property, but we'll get back to that.)
Next time: the premature obituary of the ad-based model.