What the Disney-Netflix move really means

In 2019 Disney is going to pull its content from Netflix and start its own streaming service. The announcement of this caused a minor uproar on social media with a lot of people complaining about the idea of paying yet another monthly fee for a streaming service.

So now it's time for some cold, hard truth about what is happening to television and how WE are very much responsible for it, including the people complaining about this new Disney arrangement. 

It starts with ESPN, the flagship sports network that is Disney-owned and the fact that it has been losing millions of subscribers in the past few years, enough to the point where the network lost enough money that earlier this year a major bloodletting of their employees occurred. The network is pretty much hemorrhaging money right now. 

What does that have to do with YOU? Especially if you don't watch ESPN or sports in general? Well, the way that ESPN loses a subscriber is if someone drops them from their cable service. In most areas if you have a basic cable package, you have ESPN in your lineup and the network sees a fee of about $6 and some change from you every month. You don't notice it because it's part of your cable bill and there's only one way to get rid of it......cut the cord. 

So the millions of subscribers that ESPN has lost are not just people who dropped ESPN, they are people who dropped cable altogether and went another route, which for a lot of people is "Internet Only." The reason that they would do that is to stop paying for channels that they don't want, like ESPN or FOX News for example, and only pay for Internet which gives them access to YouTube, Netflix, Hulu and every other streaming content option there is on the Internet. 

This isn't a small deal either, the television hardware industry has caught wind of this and changed their whole dynamic as well. Not only are all manufactured televisions flat screen now, they are almost all Smart TV's, meaning they have wireless Internet connections and pre-loaded apps for streaming services. They don't even put regular TV tuners for antenna broadcasts in a lot of these TV's anymore because that's not what people are largely watching anymore. Live television at a scheduled date and time is slowly but surely going away and now in the binge culture of Netflix and other Video On Demand (VOD) services, people watch their shows when they want to, in the order that they want to. 

So when Disney made the decision to leave Netflix in 2019, which also is accompanied by a move to buy BAMTech, a major streaming and marketing service, they made a move that was symbolic of where the industry has been heading for a while, which is toward an "audience-controlled," a la carte form of television streaming over the Internet. It's not a move to get more money of out you, it's a move to get your money back that you took away from them if anything. 

When Netflix popped up, it was a major game changer because not only did it effectively destroy video rental companies like Blockbuster and Family Video, but it also showed everyone the potential of online streaming for content on a "network" basis. Make no mistake, Netflix is a movie and television network that is just based on the Internet, not on regular television or cable. When people flocked to the idea of paying a monthly fee to stream all the movies and television they wanted, it changed things forever. The convenience was there and people were able to watch their favorite content without having to scroll past a hundred channels they didn't want to have access to, but were completely paying for with their cable package. 

So now Disney has joined the ranks of companies that are all slowly but surely starting to develop their own VOD services for people to use. HBO does it, Showtime does it, CBS is the first major over the air network to do it with their All-Access app, and now people are complaining that with all of these different VOD options, no one is going to have enough money to afford all of them. The funny thing is, that's what you were doing if you ever paid for cable with Comcast or Charter or anyone else. Your $100 to $250 bill every month was being spread across hundreds of channels in terms of subscriber fees, but you didn't know that because the cable companies just gave you one rate for a package and took care of the divvying up themselves. This is now just the networks, after seeing everyone ditch cable and go Internet Only, basically tell Comcast and the other cable services that they are cutting them out and selling their content to us themselves without using the middleman of a cable provider. Isn't that what you want? To deal with EXACTLY the channels and content you want instead of paying a company $100 to $250 a month to give you more than you need? 

Essentially, the only thing that is truly different from VOD services and cable are these two things: 

1 - It's streaming through the internet. 

2 - You get to pick what channels you want without being forced into a package deal, hence the "a la carte."

Now, are these VOD services cheap? Not really. They all range anywhere from $6.99 to $19.99 a month for access to whatever libraries of content they have, but those libraries can be extensive. If you want to get the best bang for your buck, you are going to have to do some homework and find out exactly what each service you want has and whether or not you want it. There can also be overlap in some cases because of who owns certain content making deals with multiple VOD providers to carry it, and it can also be in different formats depending on how many times that show or movie was remastered for HD or widescreen or any kind of up-conversion. 

The bottom line here is that Disney didn't do this to screw people over, they did it because this is where television is headed: The Internet. As more and more people ditch cable packages for Internet only service and stream their apps, the more companies are going to make the move from on-air content to the Internet and soon almost everything will be streaming online with the exception of live sports. That's still the BIGGEST thing that is keeping the cable companies and over the air networks as is because there isn't a solid online option for watching live sports locally or nationally yet. That doesn't mean they aren't trying, though. All of the major sports leagues, NFL, NBA, MLB and NHL have content apps and have made deals with FOX Sports, NBC and ESPN to stream their games to people who have them on their cable subscription. All it will take is for one of those companies, preferably ESPN, to make the move that Disney just made and start streaming their sports content online as well. 

This is the point in the article where I tell you that part of Disney's $1.58 billion acquisition of BAMTech is so that next year they will launch an ESPN-branded streaming service.

So once again, this all comes back to ESPN and the moves being made to change the industry as a result of people ditching cable for Netflix, Hulu, Amazon, YouTube and other streaming VOD apps. It's not the latest fad or craze, it is literally how television is changing as an industry. If it bugs you, then you need to stop streaming VOD content and go back to the $100 to $250 a month bills to Comcast and the other cable providers for hundreds of channels you don't watch. I'm sure that they will have no problem taking you back. They would much rather you spend your money blindly with them than spending it with some knowledge and intent of what you want like VOD offers you.