Comcast, Disney and WarnerMedia are racing to stand up their direct to consumer streaming services by 2020. Their respective parent companies have made millions licensing their content especially classic sitcoms from the last 25 years to linear broadcast stations and cable networks.
The tides have turned because more consumers are fed up with their high cable bills and opting to cut the cord. Fall of 2014 Nielsen Media estimated about 116.4 million US TV households and 97.8 million received their TV signals via cable or satellite. Four years later, roughly 93.5 million of 119.9 million total US TV households were getting their services from either cable or satellite. That difference from 97.8 million to 93.5 million households translates to more than 10 million people. Over the same four-year period, Netflix, Hulu or Amazon could be found in less than half of all US TV homes, but in 2018 the number of subscriptions to these services jumped to three-fourths of all TV homes. That’s a significant audience shift.
Giant entertainment companies were asleep at the wheel and are now racing to stand up their own streaming services and reduce their reliance on Netflix, Amazon Prime or Hulu. But why are they buying up these sitcoms?
According to VOX, 7% of all Netflix viewing was for the sitcom “The Office”. Wedbush Securities Media Analyst, Michael Pachter says older, popular entertainment properties are still mainstays for these companies. He points out… “There is a lot of security in knowing that 20 or 30 million people have viewed a particular series, so you know that it has appeal.” Add to that. . sitcoms don’t have to be watched in order making it easier for viewers to tune in and follow along.
Ironically, these entertainment companies will fork over hundreds of millions (some of these shows are fetching over $400 million) for their own content for their yet-to-launch platforms. So, how will consumers be able to watch your favorite sitcoms? It depends on what sitcom they want to watch.
Friends, The Office, Seinfeld and The Big Bang Theory are scoring deals north of $400 million from these new streamers: Comcast’s Peacock, WarnerMedia’s HBO Max and Netflix.
Netflix spent over $500 million to get global rights for Sony TV’s Seinfeld for the next five years. Sony TV struck another a rich syndication deal to move Seinfeld’s basic cable rights from its longtime home at Turner to Viacom in 2020. All this for a show about nothing … not that there’s anything wrong with that" Stay tuned.