Streaming Services: Power Rankings Summer 2023, and What's Up With Paramount+

[Snarf Zagyg]

I mean, 37 million+ stuck it out to the end (37% finished it...of 100 million), which means that it is bigger than anything on broadcast TV (somewhere in the neighborhood of 4 NCIS's). Money wise very likely to pay off for Amazon in the short and long term, once the clockbait noise dies down.

I'm sure that this is what Jennifer Salke wants to say to Bezos (along with ... "You really really wanted the rights" and "But we outbid Netflix").

But that's not the metric people use. You have to remember that not only is there a cost (the actual cost of the show- which was insane) but the opportunity cost (in other words, how much was spent promoting it, and how much precious Prime real estate and Amazon promotional effort was spent shoving it in people's faces ... and, of course, the opportunity cost of spending the money they spent on that show on something else). Not only was the cost immense, this had an insane opportunity cost- I can't remember a single show Prime pushed harder. And all the time it spent pushing this show was time it could have spent pushing something else. And they could have spent all of that money on a show with higher engagement.

As for the numbers- first, it didn't crack the top 10 streaming shows for the year (per Nielsen ... obviously, there's a whole issue of internal metrics). More importantly, it wasn't even the most watched original show on Prime (that was The Boys, which naturally had a narrower audience since it was a Hard R).

Then you have to look at how the show succeeded compared to peers. It wasn't considered a prestige show, garnering effectively bubkes in terms of awards. And the completion rate is fairly abysmal- 37% is not just low, it is well below the 50% standard of "cromulent." Which means that it wasn't compelling television that made people who watched it want to ... you know ... actually finish watching a show. That's ... that's not great, Bob.

This isn't clickbait- this is the business side of Prime. The Rings of Power might not be a ... well, a Citadel level commercial and artistic flop, but it wasn't a success by any measure. If you parse the words coming from Salke carefully, you'll see it when she talks about how this show is a huge opportunity for Prime (it's already had one season ... that's not an opportunity) and how the first season was a lot of setup, and the second season will be ... dramatic. Yeah ...

Personally, I thought the show was fine. I am one of the 37% who finished it. The person I was watching it with ... they tuned out after the first two episodes leaving me to complete it alone. I hope Prime keeps making LOTR shows- more fantasy is good. But they can't spend this type of money on shows that are neither fish nor fowl; not driving any discourse because of the high levels of quality (the "prestige" drivers) nor driving any high levels of engagement. Again, this is reportedly the most expensive series in history*- the only show that even comes close is Citadel- and it just isn't justifying the cost.

*It is difficult to determine the exact cost, depending on how you break down the licensing fees and attribute it to the cost of the show (and per season) and the costs of external marketing, but reliable sources peg it between $58 and $89 million ... per episode. But it's safe to say that it is easily the most expensive single season of television in history.

 

[payn]

I'm sure that this is what Jennifer Salke wants to say to Bezos (along with ... "You really really wanted the rights" and "But we outbid Netflix").

But that's not the metric people use. You have to remember that not only is there a cost (the actual cost of the show- which was insane) but the opportunity cost (in other words, how much was spent promoting it, and how much precious Prime real estate and Amazon promotional effort was spent shoving it in people's faces ... and, of course, the opportunity cost of spending the money they spent on that show on something else). Not only was the cost immense, this had an insane opportunity cost- I can't remember a single show Prime pushed harder. And all the time it spent pushing this show was time it could have spent pushing something else. And they could have spent all of that money on a show with higher engagement.

As for the numbers- first, it didn't crack the top 10 streaming shows for the year (per Nielsen ... obviously, there's a whole issue of internal metrics). More importantly, it wasn't even the most watched original show on Prime (that was The Boys, which naturally had a narrower audience since it was a Hard R).

Then you have to look at how the show succeeded compared to peers. It wasn't considered a prestige show, garnering effectively bubkes in terms of awards. And the completion rate is fairly abysmal- 37% is not just low, it is well below the 50% standard of "cromulent." Which means that it wasn't compelling television that made people who watched it want to ... you know ... actually finish watching a show. That's ... that's not great, Bob.

This isn't clickbait- this is the business side of Prime. The Rings of Power might not be a ... well, a Citadel level commercial and artistic flop, but it wasn't a success by any measure. If you parse the words coming from Salke carefully, you'll see it when she talks about how this show is a huge opportunity for Prime (it's already had one season ... that's not an opportunity) and how the first season was a lot of setup, and the second season will be ... dramatic. Yeah ...

Personally, I thought the show was fine. I am one of the 37% who finished it. The person I was watching it with ... they tuned out after the first two episodes leaving me to complete it alone. I hope Prime keeps making LOTR shows- more fantasy is good. But they can't spend this type of money on shows that are neither fish nor fowl; not driving any discourse because of the high levels of quality (the "prestige" drivers) nor driving any high levels of engagement. Again, this is reportedly the most expensive series in history*- the only show that even comes close is Citadel- and it just isn't justifying the cost.

*It is difficult to determine the exact cost, depending on how you break down the licensing fees and attribute it to the cost of the show (and per season) and the costs of external marketing, but reliable sources peg it between $58 and $89 million ... per episode. But it's safe to say that it is easily the most expensive single season of television in history.

One of the things I find shocking is how little folks actually talk about ROP. More folks talk about Wheel of Time and seemingly nobody even liked that show.

All the set up is fine, but if folks are not tuning in; how will the numbers get better?

 

[Parmandur]

And the completion rate is fairly abysmal- 37% is not just low, it is well below the 50% standard of "cromulent."

37%...of 100 million accounts that tried it. NCIS is the biggest show in broadcast TV by a country mile, and pulls in about 10 million viewers, as a point of comparison.

Rings of Power didn't crack the top ten because it was the 11th highest rated show last year, the top ten was all Netflix, who are obviously the reigning champs of programming.

For the purposes of discussing thia, I am leaving aside the shows artistic merit entirely, amd just looking at it from the business point of view. Amazon isn't trying to get advertiser revenue from shows, or get subscribers on the merits of their streaming service alone: they are trying to put out various hooks to keep shipping customers on brand. If 37 million households are hooked because of Ring of Power, and another 20 million (for example) who weren't get hooked by Jack Ryan, while another 25 million (or whatever) get hooked by The Boys...as long as people are convinced to stay on Prime due to the perks. It's a different business model entirely.

Another business point that I don't see this noted a lot, sell books (notice all the literary adaptations from the bookstore...?). I despised the Wheel of Time TV show, but it succeeded in reminding me that I love those books, and since the show dropped I've picked up all the audiobooks and the recent Companion and the official literary study from Amazon themselves. Lord of the Rings doesn't need a boost but dollars to donuts Ring of Power moved books, same with The Boys.

 

[Snarf Zagyg]

37%...of 100 million accounts that tried it. NCIS is the biggest show in broadcast TV by a country mile, and pulls in about 10 million viewers, as a point of comparison.

If you are a streamer, and you are saying, "Hey our big show, the one that we are spending the most money ever in history, the kind that, for the full season, would make the people who made Fast X look up and say, Brah, you're spending too much money, we did great, because we are able to compete with a show on a legacy network......"

Then something has gone wrong.

Rings of Power didn't crack the top ten because it was the 11th highest rated show last year, the top ten was all Netflix, who are obviously the reigning champs of programming.

It wasn't number 11. It was number 15. Number 11 was The Boys.

For the purposes of discussing thia, I am leaving aside the shows artistic merit entirely, amd just looking at it from the business point of view. Amazon isn't trying to get advertiser revenue from shows, or get subscribers on the merits of their streaming service alone: they are trying to put out various hooks to keep shipping customers on brand. If 37 million households are hooked because of Ring of Power, and another 20 million (for example) who weren't get hooked by Jack Ryan, while another 25 million (or whatever) get hooked by The Boys...as long as people are convinced to stay on Prime due to the perks. It's a different business model entirely.

That's the thing- they aren't hooking customers. At all. The metrics show that the show drastically underperformed in terms of having viewers simply finish watching the show. And there is no evidence that it drove viewers to Prime.

In other words, for most people Prime isn't an actual subscription- it's just something that they have along with free shipping. And for those people who have it for, effectively, free ... the show wasn't compelling enough to have them finish watching it.

Another business point that I don't see this noted a lot, sell books (notice all the literary adaptations from the bookstore...?). I despised the Wheel of Time TV show, but it succeeded in reminding me that I love those books, and since the show dropped I've picked up all the audiobooks and the recent Companion and the official literary study from Amazon themselves. Lord of the Rings doesn't need a boost but dollars to donuts Ring of Power moved books, same with The Boys.

Again, you're not understanding what opportunity cost means. You know that Amazon doesn't make a ton of money on individual book sales, right? Do you think that the cost of this show drove enough book sales, which, given Amazon's profit margins, made this a worthwhile investment?

Look, if you like the show, that's great! I enjoyed it for what it was, and will watch Season 2. I am glad that Amazon is willing to light money on fire for my entertainment. But this (along with Citadel and few other shows) is arguably one of the examples people will look back at when they discuss the excesses at the end of the peak of the golden age of the boom of streaming TV we have just experienced. As a business proposition (not a creative one), so far this is massive failure.

 

[Parmandur]

In other words, for most people Prime isn't an actual subscription- it's just something that they have along with free shipping.

Yes, that's the point. If 37 million accounts get thst hook in, that's good for Amazon's purposes.

 

[payn]

Yes, that's the point. If 37 million accounts get thst hook in, that's good for Amazon's purposes.

Gets the hook in is interesting though. Not many people like this show, even the ones who finished it.

 

[Parmandur]

Gets the hook in is interesting though. Not many people like this show, even the ones who finished it.

You may not like the show, that is a matter of taste. Of the 37 million people who went the distance, one suspects a few loved it. And Amazon getting their hooks into a bunch of niches (a "niche" of tens of millions of people, even) with their shows is the point: this whole operation is a way to get an edge over Barnes & Noble, Target, or Best Buy.

 

[Parmandur]

It wasn't number 11. It was number 15. Number 11 was The Boys.

My initial Googlong showed it as 11, must have been a per week thing I saw, my apologies, seems this is right. Point still stands, as a competitive difference maker to other e-commerce platforms this is succeeding. Best Buy isn't about to come out swinging with anything like Prime Video.

 

[Snarf Zagyg]

Yes, that's the point. If 37 million accounts get thst hook in, that's good for Amazon's purposes.

No, it isn't. I don't know how more clear this can be.

It's not a prestige show- it doesn't get any awards.
It's not a show that gets buzz; as @payn correctly notes, there are more people that talked about Wheel of Time. Even just to hate on it.
It's not a show that drives engagement. You keep repeating the same point - but that is an absolutely abysmal retention number. Really really bad. As I stated before, 50% is considered the low-end of cromulent for series in general ....let alone a big-time show. If they hadn't invested this money, it would be canceled.
And most importantly, it is far and away the most expensive show ever made. If the WSJ is correct with their in-depth reporting, we are looking at a cost of $90 million per episode the first season. That's four times as much as House of the Dragon (which outperformed it in terms of total viewership and far outperformed it in terms of completion). Again, it costs four times as much as House of the Dragon, which aired on a streamer with far fewer subscribers, and still underperformed it despite costing four times as much. Oh, and House of the Dragon received Emmy nominations for "above the line" categories (like best dramatic series).

Cost matters. A lot. Economics is the study of the allocation of scarce resources, and business is choosing how to allocate your resources in order to maximize opportunities. Here, resources are not being well allocated.

Finally, while there has been extensive reporting on the leaked information about the completion rate, there has been no confirmation of the reported "100 million" figure- which is something Prime released in terms of people who "tuned in" the first day, but they have never confirmed how they arrived at that figure. So we cannot, in fact, state that "37 million people watched the show to completion."

Because, for example, the people at Amazon might have simply juiced the numbers by taking the number of subscribers worldwide who watched a part of the first episode (say it was 25 million) and multiplying it by 4 to account for "multiple people in a household" watching it.

 

[Snarf Zagyg]

In related streaming news, at 9am PST (12pm EST) today (July 13), it is likely that SAG-AFTRA (the actors) will go on strike.

If this happens, things will get very interesting in terms of the Business.