There will never be one stop shopping for all copyrighted IP (absent some scheme like compulsory licensing).
Once some service controls a significant user base, its priorities start to shift. It's cheaper to make additional investments in advertising to gain users (or convince existing users to consume content you already license) rather than continue to add content. If you go from 1000 to 2000 titles, your reputation for content increases proportionately. If you go from 1,000,000 to 1,001,000 titles, it's not clear anyone will notice. It becomes increasingly expensive to enhance the value of your service by acquiring new content.
Sure, the most successful distributor can gain more bargaining power with some content owners, but at the same time, holdout IP owners can threaten enormous rents or go to other distributors out of a desire for a niche image. Upstart competitors can risk more to gain niche exclusives, hoping for a breakaway hit that will bring them into the game. If there's an oligopoly, like we sort of have now, the two lead services will compete for exclusivity, making content balkinized across services so no one can really get everything they want in one place.
Neither Amazon Prime nor Netflix will ever provide everything people want to watch, and it will always be a little easier for them to provide just a little less than you want to try to build a broad common pool of cheaply satisfied subscribers (while making the costs higher for services that might try to cater to those with more eclectic tastes).
Compulsory licensing could fix this, it's what we use for terrestrial radio stations and a few other arenas. Basically any radio station is allowed to play any song, they just tabulate royalties and pay lump sums at the end of the month.
If we had this for streaming services, the distributors would actually have to compete on distribution, and we wouldn't have the quality of backroom deals determining winners and losers in the streaming space. We'd actually get a long tail, instead of ridiculously tiny fractions of critically acclaimed film lists actually becoming available for the public to watch.
Once some service controls a significant user base, its priorities start to shift. It's cheaper to make additional investments in advertising to gain users (or convince existing users to consume content you already license) rather than continue to add content. If you go from 1000 to 2000 titles, your reputation for content increases proportionately. If you go from 1,000,000 to 1,001,000 titles, it's not clear anyone will notice. It becomes increasingly expensive to enhance the value of your service by acquiring new content.
That depends on the licensing model. If you model it such that the content owner gets a fixed % of the revenue for each view they get, then once you get to 1,000,000 titles you wouldn't have to pay anything more for another 1,000 titles- the people who own those titles would organise themselves to put their content on your service since otherwise they would miss out on a revenue stream.
I think if a service like spotify or netflix gets a dominant position, and presents a deal that seems fair to everybody, eventually you'll be able to find pretty much every song/movie/etc on those services.
I had originally hoped that fair terms and a desire not to leave money on the table would have brought all content to all streaming services, but I mostly revised that opinion after reading comments like those of Eric Kessler:
There are unique hurdles in negotiating fair terms with every content owner simultaneously. Transaction costs are abundant, and some people just don't want to work with you.
There will never be one stop shopping for all copyrighted IP (absent some scheme like compulsory licensing).
That is a really sad state of affairs. When bookstores and record shops were where we got content, we didn't have to go to one shop for Random House (or Warner Brothers) and a different one for Harper Collins (or Sony).
Comments
There will never be one stop shopping for all copyrighted IP (absent some scheme like compulsory licensing).
Once some service controls a significant user base, its priorities start to shift. It's cheaper to make additional investments in advertising to gain users (or convince existing users to consume content you already license) rather than continue to add content. If you go from 1000 to 2000 titles, your reputation for content increases proportionately. If you go from 1,000,000 to 1,001,000 titles, it's not clear anyone will notice. It becomes increasingly expensive to enhance the value of your service by acquiring new content.
Sure, the most successful distributor can gain more bargaining power with some content owners, but at the same time, holdout IP owners can threaten enormous rents or go to other distributors out of a desire for a niche image. Upstart competitors can risk more to gain niche exclusives, hoping for a breakaway hit that will bring them into the game. If there's an oligopoly, like we sort of have now, the two lead services will compete for exclusivity, making content balkinized across services so no one can really get everything they want in one place.
Neither Amazon Prime nor Netflix will ever provide everything people want to watch, and it will always be a little easier for them to provide just a little less than you want to try to build a broad common pool of cheaply satisfied subscribers (while making the costs higher for services that might try to cater to those with more eclectic tastes).
Compulsory licensing could fix this, it's what we use for terrestrial radio stations and a few other arenas. Basically any radio station is allowed to play any song, they just tabulate royalties and pay lump sums at the end of the month.
If we had this for streaming services, the distributors would actually have to compete on distribution, and we wouldn't have the quality of backroom deals determining winners and losers in the streaming space. We'd actually get a long tail, instead of ridiculously tiny fractions of critically acclaimed film lists actually becoming available for the public to watch.
13 of the AFI Top 100: http://www.hollywood.com/news/movies/55041194/afi-100-movies... 40+ of 700+ Criterion films: http://criterioncast.com/netflix/ 6 of Spike Lee's "Essential 86": http://blogs.indiewire.com/shadowandact/films-on-spike-lees-...
Once some service controls a significant user base, its priorities start to shift. It's cheaper to make additional investments in advertising to gain users (or convince existing users to consume content you already license) rather than continue to add content. If you go from 1000 to 2000 titles, your reputation for content increases proportionately. If you go from 1,000,000 to 1,001,000 titles, it's not clear anyone will notice. It becomes increasingly expensive to enhance the value of your service by acquiring new content.
That depends on the licensing model. If you model it such that the content owner gets a fixed % of the revenue for each view they get, then once you get to 1,000,000 titles you wouldn't have to pay anything more for another 1,000 titles- the people who own those titles would organise themselves to put their content on your service since otherwise they would miss out on a revenue stream.
I think if a service like spotify or netflix gets a dominant position, and presents a deal that seems fair to everybody, eventually you'll be able to find pretty much every song/movie/etc on those services.
I had originally hoped that fair terms and a desire not to leave money on the table would have brought all content to all streaming services, but I mostly revised that opinion after reading comments like those of Eric Kessler:
http://techland.time.com/2011/12/01/hbo-boss-to-netflix-youl...
There are unique hurdles in negotiating fair terms with every content owner simultaneously. Transaction costs are abundant, and some people just don't want to work with you.
That is a really sad state of affairs. When bookstores and record shops were where we got content, we didn't have to go to one shop for Random House (or Warner Brothers) and a different one for Harper Collins (or Sony).