[mdcds]

> “The price of streaming services is reflective of the economic realities and costs that it takes to produce and distribute the content,” Schmitt says.

Lies. Things are priced to maximize the amount of profit, which is Quantity * Price - Cost.

If you hike prices by 10% and lose 5% of customers - that's good business. $100 * 100 is less than $110 * 95

Someone who knows microeconomics better can correct me, but looks like companies can raise price and make more money as long as the demand continues to be inelastic

[aidenn0]

This is true to a degree, but note a few things:

1. The margins are very high in streaming. i.e. very little of the cost of streaming services is delivery of the video. This matters because in low-margin industries losing customers also reduces costs by a measurable amount.

2. The profits are in many cases currently negative, which is caused by

3. The demand (from the streaming services) for prestige content is larger than the producers who are considered to have a high-likelyhood of generating prestige content, so the cost of content (to the streaming services) is going up as the services throw more and more money towards production.

[PaulHoule]

My understanding that investors think Disney is "spending too much" and that includes both content for Disney+ and also some of the new developments at their parks such as the crazy-expensive Galactic Starcruiser.