The Removal of Movies and Shows from Streaming Services: A Business Decision, Not Personal
The concept of streaming was once seen as a permanent solution for accessing a vast digital library of movies and TV shows.
Consumers became accustomed to the idea that content on platforms like Netflix would cycle through, as studios launched their own streaming services and moved their proprietary content accordingly.
The removal of content became an accepted reality as the cost of doing business, as demonstrated when Warner Bros. Discovery pulled content as part of planned tax write-offs related to its merger.
However, the recent decision by Disney to remove numerous shows and films from Disney+ and Hulu, including popular titles like “Willow,” “The Mighty Ducks: Game Changers,” and “The Mysterious Benedict Society,” has confronted subscribers with a new reality.
Many consumers had initially expected that shows on a streaming platform would remain there indefinitely, but they started noticing content expiring or disappearing.
The shift in the streaming landscape is driven by changes in the industry’s dynamics. After a period of rapid growth fueled by pandemic lockdowns and fresh content, the streaming industry has now cooled down.
Wall Street is now focusing on whether and when streaming will become profitable for media companies, shifting its attention from subscriber numbers. This change came after Netflix reported its first subscriber loss in ten years.
The primary challenge for consumers is understanding why content specifically made for streaming platforms is being removed, while Netflix’s original content remains untouched.
Consumer confusion arises from a lack of understanding about how content licensing works. When a title is not owned by the streaming service, licensing fees must be paid to the studio that owns the content. Even in-house titles require licensing agreements. This is why NBCUniversal paid itself $500 million to stream “The Office” on Peacock, and Warner Bros. Discovery paid $425 million for the streaming rights to “Friends.”
By removing content specifically created for streaming, rather than licensed shows and movies, media companies like Warner Bros. Discovery and Disney can immediately reduce expenses.
Warner Bros. Discovery reportedly saved “tens of millions of dollars” after removing content. The removal of movies and TV shows began last summer and has continued with the removal of original HBO and Max content.
This approach has received criticism from subscribers who feel discouraged from investing in future original content, similar to how traditional TV shows get canceled.
Streaming services must carefully balance their content decisions. Highly successful shows like Max’s “Peacemaker” and Disney’s “The Mandalorian” are unlikely to be pulled from their respective platforms.
On the other hand, underperforming shows and films may be at risk of being removed. Data from Parrot Analytics shows that the demand for the removed titles on Disney+ and Hulu represented only a small fraction of the total catalog. However, these titles are not permanently lost, as Warner Bros. Discovery has started licensing the content to free, ad-supported streaming platforms like Tubi and Roku, allowing them to generate additional revenue.
In their quest for profitability, media companies have been exploring various advertising strategies, including cheaper ad-supported offerings and distributing content on FAST (Free, Ad-Supported Television) channels.
It is essential for consumers to recognize that streaming platforms provide a convenient way to access content, but it does not guarantee indefinite availability. Purchasing movies or TV shows on home video remains a reliable alternative.
