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You cannot spend your way into scaling an original content business. Period. Every MBA wants to create predictable success with a recipe or a formula but it do

by jmyeet 4y ago

You cannot spend your way into scaling an original content business. Period. Every MBA wants to create predictable success with a recipe or a formula but it doesn't work that way. And if you do stumble into an an Ozark, it doesn't mean you can just create 100 Ozarks. Quibi tried to spend their way into original content. It failed spectacularly then. Many shows were cut short. Without the direct feedback loop of ratings it can be extremely difficult to know what to renew and what not to renew. The wrong metrics can lead you astray. Some shows had too much money. Others not enough. And the real big lesson in doing all this is that the economics of big budget movies completely fail without theatrical releases. You just cannot recoup production costs otherwise. There's a reason Top Gun: Maverick delayed release 2-3 years. And if you overspend the only way to recover that is by raising prices. Do that too much and it becomes a vicious cycle just like cable TV of ever-increasing price hikes to balance out the inevitable subscriber losses.

somenameforme 4y ago
Uncommonly known fact: the exact same issue is facing Hollywood. Ticket sales reached their peak 20 years ago [1] and have been in a steady decline since. "Record breaking [domestic] sales" refers to gross revenue and it's being driven exclusively by inflation and higher ticket prices. Ticket sales themselves are down 23% as of 2019 (to avoid the huge biases since COVID). And that's happened as the US population in the past 20 years has increased by nearly 50 million. Kind of encouraging in one way, because the natural response to the observation that movies suck today is to claim that Hollywood is just making what the "masses" want. Nope! [1] - https://www.the-numbers.com/market/ https://www.the-numbers.com/market/
- ghaff 4y ago
  Or there's just increased competition for screen time--including from the likes of TikTok and YouTube. And screen time is, if not zero sum, at least zeroish sum; there are only so many recreational hours in the day. To be honest, I'm a bit surprised theaters seem to have actually bounced back reasonably well from COVID. I guess that a lot of people find them, among other things, a relatively low cost/low friction option to get together with friends, go on a date, get out of the house, etc.

by jmyeet 4y ago

somenameforme 4y ago

Uncommonly known fact: the exact same issue is facing Hollywood. Ticket sales reached their peak 20 years ago [1] and have been in a steady decline since. "Record breaking [domestic] sales" refers to gross revenue and it's being driven exclusively by inflation and higher ticket prices. Ticket sales themselves are down 23% as of 2019 (to avoid the huge biases since COVID). And that's happened as the US population in the past 20 years has increased by nearly 50 million. Kind of encouraging in one way, because the natural response to the observation that movies suck today is to claim that Hollywood is just making what the "masses" want. Nope! [1] - https://www.the-numbers.com/market/ https://www.the-numbers.com/market/

ghaff 4y ago
Or there's just increased competition for screen time--including from the likes of TikTok and YouTube. And screen time is, if not zero sum, at least zeroish sum; there are only so many recreational hours in the day. To be honest, I'm a bit surprised theaters seem to have actually bounced back reasonably well from COVID. I guess that a lot of people find them, among other things, a relatively low cost/low friction option to get together with friends, go on a date, get out of the house, etc.