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Does the end of the Hollywood strikes also mark the end of ‘Peak TV’?

TVBEurope talks to analyst Fred Black about how the Hollywood strikes, coupled with a scaling back of 'Original' content by the major streaming services, is signalling the end of 'Peak TV'

With the news that the SAG-AFTRA strike has been suspended, production on High-End TV and films is expected to resume around the world again in the coming weeks and months.

The strike has had a huge impact on the industry, with very little studio production work taking place over the last six months.

But, with both the WGA and SAG-AFTRA agreeing terms with the AMPTP, there is hope the industry will return in some way to its pre-shutdown levels.

The lack of production, particularly over the summer months, has had a profoundly dramatic effect on the industry, Ampere Analysis’ Fred Black tells TVBEurope.

“In the period May-October of 2022 we saw 571 US-produced scripted TV seasons or films green-lit. In 2021 that was 612. This year it was only 270. That’s an enormous reduction in content supply, and we’re already starting to see the effects,” he explains. “Last year 131 new scripted titles were released in September, this year that was only 69.”

The shutdown means audiences are likely to see fewer films and TV series released in the coming months. Many tentpole movies have already seen their release dates pushed to late 2024 or even 2025.

“For audiences, disruption is likely to peak between now and February, with the number of releases over this period likely to be reduced by well over 50 per cent,” states Black. “After this, some of the delayed projects, where production was stopped earlier in the year due to strikes, will likely start to be completed and able to fill some content gaps. However, disruption will continue to have an effect throughout next year. In particular, this is where the lack of content ordered over the last six months will start to take effect, while delayed projects can start filming again, the reduction in content supply is here to stay.”

There’s been much talk that with the proliferation of content available to audiences in recent times, the industry has reached what’s been described as ‘Peak TV’. While Black says he thinks that idea was coming to an end before the strike action started, the strikes have dramatically increased the pace of change.

“After several years of high and increasing spending, coupled with Covid effects causing delays to projects, a glut of 721 scripted US TV series were released in 2022, 624 of which had been released by the end of October,” he explains.

“This year, to October only 485 seasons have been released, a similar volume to that seen in 2019 and 2020. All this is to say that we have already this year seen a drop of 22 per cent in the volume of scripted TV coming out of the US, and that’s before we’ve begun to feel the bulk of the effects of the production stoppage.”

Black adds that ‘Peak TV’ was already coming to an abrupt end primarily due to the dramatic scaling back of the Original ambitions of the major streaming services.

“As SVoD services have pivoted from a focus on subscriber growth to profitability, they have needed to rein in content spending, as well as find new (or old) revenue lines, including licensing content,” he adds. “That has a knock-on effect as the studios open back up to licensing content, this reduces the need of non-studio SVoD services like Netflix and Amazon to produce original content at such extreme volumes. They can now more easily supplement their catalogues with studio-owned titles instead.”

The final shift heralding the end of ‘Peak TV’ in the US has been the internationalisation of SVoD content, states Black. Ampere’s research found in the first half of 2020, the US accounted for 28 per cent of new SVoD scripted shows being ordered globally (First-Run only, excl China).

“In the first half of this year, that figure was only 16 per cent. but even more interestingly, it was only 16 per cent in the second half of 2022 as well, long before the strikes could have had an effect,” Black adds.

“That movement is occurring in two ways, both US-owned streaming platforms becoming increasingly internationally focused, as international markets offer an easier route to subscriber growth than the saturated US market, and the increasing number of local or regional rivals in the SVoD space. Both of these shifts, however, point to a TV industry that is significantly shifting away from Hollywood.”