The new Netflix war is all about quality vs quantity

As HBO's new boss announces he's firmly in the quantity camp, Diego Monteiro takes a look at what it all means for the future of streaming.

“It’s not hours a week, and it’s not hours a month. We (HBO) need hours a day. You are competing with devices that sit in people’s hands that capture their attention every 15 minutes.” This is part of a recent statement made by the leader of HBO, John Stanley, which shows how they no longer want to be known for their big productions, but want to enter into day-to-day content consumption.

The new location of the media war: streaming for ongoing consumption

It might seem like the declaration of just one more channel, among so many others, but it seems to me to be very symbolic, principally for speaking about this new scenario, which has been in the works for years. Everything seems to indicate that, now, the Netflix model will not be the exception, but the rule.

In 2018, Netflix decided to launch a new film or series of their own every week. This move is, clearly, in preparation for 2019 when Disney’s streaming service will attack and to competition from Amazon, Hulu, HBO Go, etc. The strategy is to have a huge collection, not necessarily of great quality, to maintain the lead in this market.

Quantity versus quality

Miracles do not exist. When we increase the quantity, the quality decreases. A while ago, when we saw a series with the label “an original Netflix production,” we knew that it would be something relevant. But they have lost this. HBO had retained that label and it seemed that they would use this in the war for the streaming market, but now, with this declaration, everything indicates that they will follow the same path as Netflix. They will compete on the same playing field as the main player.

In business that is the way it works: the leader dictates the rules. We know that streaming is the future, and so it’s natural for everyone to follow the Netflix model. But is this positioning really good?

Media business is a mix of large numbers with relevancy

HBO and Netflix are not crazy. They made a business decision based on numbers, and, in fact, it seems that in this case it has had an effect. However, in the medium term, a media company will only survive by joining access numbers to relevance and credibility.

It seems like the secret is to move toward quantity and then relevancy. Will they be able to achieve this? That’s something only time will tell, but more important than anticipating what this rather bold strategy is going to deliver, is knowing the impact of it on marketing and consumer behavior.

The marketing impact of the new streaming scenario

The fact is, the major streaming platforms, which we can already assume will shortly be the default, are, at the same time, inundating their users with digital entertainment options and leaving a gap for productions with higher quality and relevancy.

Changes in media consumption

Traditional TV will have to make the initiatives for streaming take off. Nowadays, there hardly exists a traditional TV channel which does not yet have some app for watching videos on demand. However, in 2019, these platforms are going to have to really work, because that is when we will have a flood of options in the new format, and, probably, an abrupt drop in traditional consumption.

In turn, the audience will face the challenge of selecting what they actually want to consume as content offerings will run rampant.

The brands, along with the possibility of producing their own content, will also be able to design their own curatorship to navigate this world of content.

Opportunity for brands

Traditional TV will, in turn, have to create content with greater calmness and depth. When a brand is an expert in a niche it does not need to release new content every week. However, because of this, it will need more assertive productions.

However the universe keeps growing. Working with videos in short formats is also a ‘blue ocean’ where content producers are tending to expand their performance, opening space for the brands.

While the big productions turn into hour and a half movies or 40 minute episode series, casual video consumption of seven minutes or less is borne by the YouTubers and Instagrammers who are easier to compete with when looking to generate differentiated content.

Diego Monteiro is director of Smarty Talks.


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