Welcome to What I’m Hearing+, coming to you from the New York screening of Apple’s Napoleon. This is my most highly anticipated movie of the year—even if, as a die-hard student of the revolutionary era, I’ll surely be one of those people that director Ridley Scott wishes would “get a life” rather than point out all the inevitable historical inaccuracies.

Tonight, a closer look at the race between Alphabet, Apple, and Amazon to create a single, unified streaming platform. (Spoiler alert: The key isn’t just amassing the most content, but also focusing on the consumer journey.)

But first, a few thoughts on Netflix’s next frontier…

• Netflix Gaming Finally Gets Serious: During its recent Geeked Week celebration, Netflix unveiled a handful of trailers for upcoming film and TV projects, but the most interesting (and under-discussed) announcements pertained to its gaming division. Netflix plans to introduce several new games to its in-app experience, including Braid, Hades, and Death’s Door. This is a big deal for two main reasons: It’s a statement that Netflix has committed to getting games right; and these are games that encourage lengthy, continuous play.

  I’m frequently asked whether Netflix’s gaming strategy is working. It’s impossible to tell without direct data, but third-party analysis from Apptopia suggests that Netflix games have been downloaded around 70 million times in the two years since the service launched. The company also has an average of 2 million players per day engaging with at least one game. Meanwhile, the number of games that Netflix carries has more than tripled, from 23 titles at launch to roughly 75 this year. Less than 1 percent of Netflix’s total subscriber base is gaming on the platform, but it’s a smart play given the relative youth of the service’s average user and how much time subscribers spend on their phones (especially in India and Thailand, where Netflix has pushed mobile-only subscriptions).

  Netflix is investing real money here, too. While the company’s first games were directly tied to Netflix I.P.—Stranger Things, Love Is Blind, Arcane, Bridgerton, etcetera—the three new titles are iconic PC or console games from beloved studios, including Devolver Digital and Supergiant Games. Similar to its acquisition of Oxenfree developer Night School Games, the emphasis here is on providing gaming fans with strong mobile experiences, not just gimmicky tie-ins to blockbuster shows.

  It’s not a riskless project, of course: Gaming was Bob Iger’s biggest self-proclaimed failure during his first stint as Disney C.E.O. Disney’s in-house studio focused too much on movie tie-ins rather than developing strong games that created brand affinity for its universe of characters. (Square Enix and Electronic Arts, which licensed characters from Disney for their respective Kingdom Hearts and Star Wars game franchises, understood this.) In the end, Disney ended up shuttering its gaming studio and licensing its I.P. instead.

  The global video game market, which has grown to more than $200 billion a year, is also hyper-competitive. Netflix will need to make major investments to differentiate its offering from the more than 260,000 games available on the Apple App Store, and counting. In the meantime, Netflix isn’t charging any additional money to access its games—which also don’t have ads or offer in-game purchases—but the announcement of Braid, Hades, and Death’s Door signals that Netflix is moving in that direction, by appealing to actual gaming fans—many of whom are also Netflix subscribers. Watch this space.

It is, after all, the number one video rival to linear TV and the primary video player for kids, teens, and young adults. Now, with YouTube buying NFL rights, via Sunday Ticket, and making a play for cord-cutters with YouTube TV, it’s become a genuine streaming threat, too. In fact, by bundling free user-generated content, premium video channels, and a digital cable replacement, YouTube is setting itself up to be more powerful than a mere streaming service, but rather a platform upon which all of those other services sit—a veritable operating system for the streaming age.

Interestingly, the market also seems to be underappreciating that the same opportunity for Alphabet is also open to Amazon and Apple: All three are competing to dominate the streaming video ecosystem with hardware and operating systems built into TV sets that effectively replace the traditional distributors, ensuring that their platforms are the entry points for TV viewing globally. To paraphrase NBC’s late, great Heroes: Control the living room, control the video market.

Of course, Amazon and Apple have been pushing toward this endgame for some time. In 2019, roughly 30 percent of all subscription video services went through iOS, Roku, or Amazon in the U.S., a 210 percent jump from four years earlier. Intermediary channels are still growing, but it’s no longer solely Amazon, Roku, and Apple playing in the U.S. Other gatekeepers, including Google and Samsung, have cut into the share. While that’s decreased the individual market share of companies like Amazon and Apple, the number of subscriptions by payment channel has resulted in total intermediaries growing from 18 percent in 2019 to 31 percent by the end of 2022, according to data from Antenna, as revealed by analyst Matthew Ball.

It was a situation, once again, in which legacy media companies sleepwalked into dependence on Silicon Valley, whose hegemons soon ate their lunch. Hollywood studios and cable networks needed more distribution, and the Apples and Amazons and Googles were happy to provide the hardware, software, and payment infrastructure—for a price. (Apple famously takes 30 percent of all subscription fees for the first year, and then 15 percent in subsequent years.) Streamers are now more protective of their advertising inventory and subscription revenue, seeking a more direct relationship with customers that bypasses Apple’s tolls, but they still mostly rely on those bigger tech platforms to reach viewers through their TVs.

Since 2019, though, everything has gotten more complex: Streamers have matured from a strategy of sub-growth-at-all-costs to one of retention and price enhancements; new ad-supported tiers have been established to monetize borderline viewers; after years in which everyone retreated into their corners, there is a new push toward cross-platform licensing. Those ad-supported tiers, in particular, require a new level of scale and ad tech, which has prompted a new surge in partnerships: to wit, suppliers are consolidating their own apps, and broadening potential customer bases by leaning on larger distributors.

Max, which was removed from Amazon Prime Video Channels in 2019, has returned to the Channels distribution system and now includes Discovery programming. Paramount Global’s combined Paramount+ With Showtime is a top placement within YouTube Primetime Channels and Amazon Prime Video Channels. The companies need the additional ecosystem play from customers who might otherwise not think about their programming, but it means giving up advantages somewhere (full advertising inventory and customer data control) to try to cure short-term disadvantages (acquiring and retaining customers) elsewhere.

In reality, as advertising emerges as a key revenue line, we’re on a collision course between the streamers and the platforms—between companies worth tens and hundreds of billions of dollars and those with market caps in the trillions. And, interestingly enough, the final stage may look a lot more like the old world than many ever expected.

Our industry talks often about ecosystems, but we haven’t really delved into the inherent flywheel opportunities. Amazon became the largest book retailer through its Prime ecommerce business. Then it launched Kindle to create the hardware required to instantly read ebooks available through Prime, often at a discount. Amazon proceeded to buy Goodreads, a social site that encouraged additional reading and tied it back to Prime to create a one-stop shop for ease and convenience.

You can see the same logic in its video business. Amazon’s Fire operating system, which powers its Fire TV stick, is now undergirding its partnerships with TV makers as it gets its interface pre-installed across the industry. (The connected TV business could be a $100 million marketplace by 2028, according to some third-party estimates.) Prime Video investments, including sports and premium series/films, brought customers into the video matrix. And Prime Video Channels, where credit card information was already stored, made it easy to sign up for entire streaming services that were available through the ecosystem. Free streaming options like Freevee were built right in, too. Why ever leave?

Well, companies like WarnerMedia (premerger) saw that the fix was in and removed their services from Amazon Prime Video Channels. When Peacock and then-HBO Max launched in 2020, neither was available on Prime Video Channels or Roku for weeks because there were disagreements over the percentage of advertising inventory and subscription signup fees that the distributors would take (as well as arguments over who would get access to the customer data for targeted advertising).

So why would they support a threatening competitor now? Part of the answer is in the industry-wide pivot toward ad tiers. To make those tiers worthwhile to advertisers, engagement needs to increase, meaning customers need to open the app, meaning companies need to find ways for their apps to remain top of mind and in line of sight.

I previously wrote that the streaming industry has a tunnel vision problem—if people don’t see it, they can’t acknowledge it, and engagement runs the risk of plateauing. This is especially true for non-Netflix platforms that lack scale or appointment viewing like live sports. It’s not just entertainment, either. It isn’t impossible to imagine Amazon launching a Sports app (something that C.E.O. Andy Jassy previously spoke about) and corralling all the fans looking for games either on Prime Video or another app (like Max) and collecting part of the signup fee and ad inventory. Figuring out where ESPN fits in this likely scenario is Jimmy Pitaro’s complex, and fairly unenviable, task.

The recent Charter-Disney carriage deal is apposite because it suggests two crucial points: Customers love bundles, and companies like Disney need stronger access to big distribution channels to better monetize their ad-supported products. Warner Bros. Discovery C.E.O. David Zaslav and Paramount Global C.E.O. Bob Bakish also suggested they could follow suit in deals that would offer their ad-supported tiers. If the future of television is a collection of streaming platforms being offered as part of a package, the companies with the most to gain aren’t the traditional cable players but the tech giants, who have the better user experience, the better retail experience, and more direct access to customers.

Now, Disney, Warner Discovery, Paramount, and NBCUniversal all need stronger distribution ties as they fight to reduce churn and increase the lifetime value of their subscribers, especially as customers seek out better bundles with a one-stop-shop function. But they also don’t want to cede control to the tech giants, who have clear designs on dominating streaming and digital video in the coming decade, even when a partnership seems like the simplest solution in the short term. There’s a reason that legacy media is worried about Amazon and Google; it’s not just because of their original content play. That’s arguably the least of it.

Of course, as advertising becomes a pillar of the streaming business, nobody will want to outsource their ad tech or cede inventory to Amazon, Google, or Apple—two of which boast some of the largest advertising businesses globally. (Consider a scenario in which Disney wants to sell discounted tickets to Disney World or merchandise through the Disney+ app.) But if Amazon monopolizes that customer data, what’s to stop it from leveraging that to boost its own retail operations, including selling similar products for a cheaper price via Prime?

There’s also the question of which companies control the most valuable real estate across smart TV screens. Disney+ may one day be a tile on a homepage powered by Amazon Fire OS. And, sure, it may include a strong placement for a big new show (like the Loki season two finale) right up top, but if it’s the global homepage for a significant portion of household TV viewing, the true question becomes: Who can deliver the stronger advertisement with the greatest audience and impact, the content suppliers or the new front page gateways to Hollywood?