Last week, I flew to Palm Beach for the Guggenheim Museum's annual media conference to brief a group of investors and hedge fund managers on the startling trend. Over the past few years, facing mounting losses and slowing growth, streaming companies like Max and Disney+ have opened the doors to their walled gardens and begun licensing content to Netflix. The short-term goal, of course, was to generate revenue and service its debt in order to raise its stock prices. But investors in Palm Beach had the opposite concern: They worried that a strategy of paying down short-term debt made these companies vulnerable long-term. Was this just a temporary respite from the streaming wars, they wondered, or were these platforms essentially waving the white flag?
The answer, as always, is complex, but the signs all point in one direction. First, I shared data from Parrot Analytics, where I serve as VP of Strategy, and highlighted how Netflix has been steadily increasing its share of audience demand — a proprietary metric that includes video consumption and social media activity — over the past four quarters with this licensing trend moon. Peacock also grew somewhat over the same period, but for the rest of the streaming companies, the data is bleak: demand for Max, Disney+, and Hulu has been relatively stagnant, and demand for Paramount+ has declined. decreased.
