[nemothekid]

>I would be all over Hulu expect I refuse to pay for a service AND see ads. I would rather pay $20/mo and not see ads then pay the $10/mo and see them. Almost as bad as having to see ads in the first place the ads on Hulu are painfully repetitive at times.

You are going to have to make a better offer to the studios that are currently charging customers $80/mo AND forcing them to see ads.

Hollywood would have to slim down significantly if it was going to go Netflix-model primary on all its content.

[meesterdude]

I'd argue "hollywood" and media companies are significantly bloated as is, and slimming down would only be in consumers best interests. They have so much money they don't know what to do with it all.

They charge $80/mo (sometimes much more) and show ads because they can get away with it And we let them. There are also other old economics (like paying for channels you'll never watch) at play that are no longer applicable with the internet.

The netflix model is tricky. On the one hand, it's a constant stream of income. On the other, there is ever increasing licensing fees and questionable return on investment when they produce a new show. I don't know that it's an ideal model, in those regards.

I think (or hope) that what will win out is the ability to vote with your wallet. I watch some shows, and I want the shows I watch to do well and stay on the air. Equally, i don't give a crap about the shows I don't watch. But I think a barrier to that will be the price tag they attach, which will likely not be anything reasonable.

And this circles back to the topic of hollywood: a few companies in control of the majority of the market, inflating prices to line their pockets. But the internet levels some of the playing field, so an independent could come along with little more than a youtube channel and compelling content and bypass all their nonsense. And I think that will be the best thing: competition.

[nemothekid]

In terms of content production I think the only economics that have changed significantly have been production technology (CGI, cameras, which has gotten more expensive) and distribution (which is now near free).

That said I don't buy the claim that "they have more money than they know what to do with". Content Production is expensive. Netflix spent $100M in total on House of Cards, and it looks like they are spending $4-5M per episode on their original shows. I'm unsure that without big budgets that small budget productions other than "Let's Plays" and talking heads will ever be successful.

And not only is it expensive, but it is hit driven, your hits have to be able to cover the cost of your other 5-6 failures. You have to have enough cash in bank to weather a lackluster season.

It's doubtful the Netflix model @ $20/mo will be able to cover the million dollar salaries that movie, tv, and voice actors are accustomed to. I'm also unsure they will be able to cover the CGI and production budgets of current big budget films. And currently the internet has yet prove you can support a small production team producing anything more than 3-5 minute content using the internet without a big sponsor. It's also unlikely that you will ever be able to vote with your wallet - bundling ensures that the successful films you watch also pay for the the 3 or 4 failures that came from that studio.

In short my point is its going to take a lot more than cutting a few executive paychecks.

[jquery]

> production technology (CGI, cameras, which has gotten more expensive)

Absolutely not. Production (at a given level of quality) is cheaper than it's ever been. Consumer standards might be respectively higher, but that's not apples to apples.

> It's doubtful the Netflix model @ $20/mo will be able to cover the million dollar salaries that movie, tv, and voice actors are accustomed to.

These actors might have to get accustomed to less, like everybody else.

[nemothekid]

>Absolutely not. Production (at a given level of quality) is cheaper than it's ever been.

I have no data to back this up, and I'll spend some time looking for this, but this doesn't seem true. While hardware, processing power, and sets may have gotten cheaper, I'd argue that the cost centers behind production has always stayed the same and that its been salaries. And I'd argue its worse now that you have to hire VFX teams - no camera costs as much as 90K/yr VFX artist.

>These actors might have to get accustomed to less, like everybody else.

Which is why I'm sure the entertainment industry is going to spend a lot more time figuring out how to squeeze comcast prices from the internet generation. And I'm sure its more likely that they will cut a few writers, and cheap out on the CGI before Brad Pitt get called in to negotiate.

[toomuchtodo]

> Hollywood would have to slim down significantly if it was going to go Netflix-model primary on all its content.

Similar to the contraction the music industry is going through because music isn't as valuable when there is so much more of it to listen to (ie Taylor Swift vs Spotify)?

[nemothekid]

I'd argue its different because the music industry only really every had one lever - marketing and distribution, and the internet made the former really cheap and destroyed the latter. Taylor Swift's label is technically an indie label, and I'm willing to bet the budget and people employed in the production of her latest album is a tiny fraction of what Michael Bay employed in his latest Transformers flick.

Due to the huge budgets and returns movies still have, studios are a lot closer to venture capital firms than distributors. If it ever contracts it would likely be in the form of making less content and making safer bets rather than paying everyone less.