Netflix and other streaming services have been on the rise in recent years and in 2019, their rise to power will hit a major milestone. According to a new study, streaming service revenue will surpass that of the global box office next year for the first time in history. Does this mean that more studios will begin developing directly for streaming services instead of going theatrical for mid-budget or smaller projects? Maybe. Maybe not. But the tide is turning in favor of streaming.
According to the study, subscription revenue for streaming services is expected to reach $46 billion in 2019, whereas box office revenue worldwide will top out at $40 billion. Not only is Netflix at the head of the pack with nearly 140 million subscribers globally, but Amazon has been making serious headway in that department, with other big competitors like Hulu out there as well. Plus, Disney is launching Disney+ next year in order to compete directly with Netflix, not to mention other niche services such as the horror-themed Shudder or DC Universe that can cater to a very specific audience.
Point being, there are going to be more and more streaming services coming our way next year and they all have something to offer. On the flipside, the study finds that movie tickets may simply be too expensive for many. Why pay $10 or more for a single movie ticket when one can stay at home and watch one of thousands of movies on Netflix that are included in the cost of a monthly subscription? This is why more and more filmmakers such as Alfonso Cuaron (Roma), the Coen brothers (The Ballad of Buster Scruggs) and even Michael Bay (6 Underground) are working with Netflix.
Not surprisingly, the study finds that in countries where movie tickets are more expensive, such as in Scandinavia where a single ticket averages $13, theater attendance is lower. On the flipside, attendance is much higher in Mexico, where tickets average just $2.50. But with the rise of streaming services, and the increased cost of going to a movie theater, consumers are being more picky about what they actually pay to go see. However, the desire for good content remains. Toby Holleran, a senior analyst who contributed to the study, had this to say.
"There's clearly an appetite for content amongst some consumers whether that be on the big screen, or a smaller one. The key for cinema is to understand that while SVOD subscribers are more avid cinema goers, this may not always be the case. Therefore, the shared experience of watching a film on the big screen must remain an enticing, and realistically priced, one."
While blockbusters like Avengers: Infinity war and horror hits like A Quiet Place can still bring in the big bucks, other more risky mid-level projects like Bad Times at the El Royale have a much more difficult time making what they need to make in order for studios to justify giving them the green light. So, while streaming services are convenient, if this trend continues, it could wind up limiting options that moviegoers ultimately have when they do decide to head to a theater. There is a handy graph below illustrating the rise in streaming service revenue, compared to box office revenue. This study was conducted by Ampere Analytics.