For the past few weeks, I’ve shared a thought experiment I call platform chess—an exercise that I often employ with my clients at Parrot Analytics, where I work as director of strategy, to determine the genres in which each streaming service is under-invested, over-indexed, etcetera, specifically when it comes to originals they’re acquiring. In Part I, I examined the tech giant platforms: Apple TV+ and Amazon Prime Video, which still have room to grow. In Part II, I assessed the incumbents: Paramount+, Peacock, and Hulu, which have voluminous libraries, but must strategically horsetrade before they are bought or sold, themselves.
I’m not a creative executive, and I don’t pretend that I can re-program these platforms better than their own experts. But I can use proprietary data, as well as third-party sources like Nielsen and Antenna, to provide insights into what’s working, what’s not, and where capital could be deployed more effectively. Herewith, the third and final installment of my streamer report cards, focused on how Netflix, Max, and Disney+ are navigating the landscape—and where they can grow, or cut back, to create the largest and most stable businesses.
Netflix for Kids
Netflix, in many ways, is a victim of its own success. With around 232 million subscribers, the first pure-play streaming service was also the first to approach the limit of its total addressable market in the U.S. and Canada. But growth has slowed, forcing co-C.E.O.s Ted Sarandos and Greg Peters to launch ad-supported tiers, password-sharing crackdowns, and other pricing levers to reach new demographics and reduce churn. These pivots were largely greeted with schadenfreude by industry competitors. In reality, however, they were smart and necessary tools for opening new revenue streams. In its infancy, Netflix espoused the virtues of ad-free, direct-to-consumer streaming; in middle age, it has embraced the revenue agnosticism of a mature public company.