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Born circa 2013, died 2023 — 10 glorious years marking the rise and death of Peak TV — is disinterred and examined in a new report, which also predicts what Hollywood and viewers can expect of the next phase of home entertainment.
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In a nutshell: the rise and the demise of Peak TV (roughly the period between House of Cards to the finale of Succession), was the result of a number of factors not least being an oversaturation of prestige drama and a content spent that jumped from $139 billion in 2014 to $243 billion by 2022.
One thing we can be sure of going forward: fewer premium series, more content like the network cable TV of old.
Variety Intelligence Platform has crunched the numbers, produced by data marketer Luminate, which were presented by VIP+ media analyst Tyler Aquilina at SXSW.
2022 was actually the year that TV finally actually peaked. Luminate data shows 2023 saw a drop in original series output across all major streaming platforms, plunging from more than 2000 titles in 2022 to just over 1600 last year (20% drop year over year) — following two decades of almost continuous growth.
Arguably, as Aquilina outlines, the boom in TV began in the early 2000s, when cable networks realized that they could make themselves more valuable to viewers and therefore gain bigger audiences, by creating slates of original programming that viewers wouldn’t be able to find anywhere else. Think The Sopranos, Sex in the City and Mad Men.
But 2013 was when Netflix entered the equation, bringing originals like House of Cards and Orange is the New Black.
“This was a key tipping point in the history of TV because 2013 was the first time when the FCC measured an annual drop in US pay TV subscribers,” said Aquilina. “In other words, that’s when cord cutting really got going for the first time started being whispered about in Hollywood circles.”
Skipping forward to COVID-era 2021 and 2022, the amount of original content on streaming “just balloons” — but early 2022 also marks the first quarter when Netflix began losing subscribers as macroeconomic conditions bite.
“It’s enough to make everybody freak out and pretty much changed the calculus around streaming overnight. All of a sudden, Wall Street investors are paying a lot more attention to how much money these companies are spending and how much they’re losing on the streaming platforms.”
Studios like Warner Bros. were pouring billions of dollars into original content in order to compete with Netflix and racking up massive deficits in the process. This led to cuts in spending and that meant less TV shows.
VIP+ data shows that 2023 was the first year since 2013 when the number of original shows released on SVOD fell — from 1,000 in 2022 to less than 800 last year.
But that doesn’t quite paint a full picture. VIP+ and Luminate expect aggregate spend on TV content in Hollywood to go up this year. Only by 2% or $4 billion to around $247 billion, but a rise nonetheless, with Disney expected to be the biggest spender at around $33 billion.
“More significant than just how much these companies are spending is where this money is going. Because companies have shown they’re still willing to shell out for the right programming, which at this point mainly means sports broadcasts.”
Analysts and industry observers expect that spending on general entertainment TV is going to be flatter over the next few years meaning less money for TV and consequently fewer shows are going to be produced.
“The industry is headed for a contraction, there’s just not going to be the level of output that we had over the past decade,” said Aquilina. Factor in time spent by younger audiences on TikTok and other social media has a detrimental impact on time spent with streaming TV.
So how is TV going to change in this post-Peak TV environment? Apart from fewer originals there are likely to be a lot more shows based on popular IPs (like HBO hit The Last of Us) — shows that cater to existing fan bases.
Shows like Mad Men, Atlanta or The Bear will have a much tougher time getting greenlit in this environment, he suggests.
The days of a large number of expensive to produce or creatively risky shows are likely over. “You can get more for your dollar with unscripted content like reality shows,” he said citing Netflix series Love Is Blind.
In tandem with that, expect more reruns of existing content — a trend that already supports a lot of streamed video consumption (think Friends, Grey’s Anatomy, The Big Bang Theory).
There’s going to be a greater reliance on international non-English language TV. For one major reason, it’s cheaper.
“These shows can be produced for less money internationally than shows typically cost in the US. They can be acquired for much less than you’d spend to create a new drama or comedy series shot here.”
Korean drama is the logical place to look for a hit but VIP+ points to shows emanating from Sub-Saharan Africa and India. That’s because with the Europe and US markets pretty saturated, major streamers like Netflix are targeting growth in other territories and are doing so by investing in local content.
“I wager that an Indian series may very well become the next Squid Game,” Aquilina said. “I think that in the next few years an Indian series really becomes the next big breakout international hit.”
How else will post-Peak TV change? The rise of AVOD and FAST, plus new provisions in the new writers and actors guild contracts, will see ratings reported from streamers who were previously black boxes when it came to exposing how their content fared.
That might be taken as a plus, at least for media companies with broadcast divisions. VIP+ highlights other silver linings too, although they are fairly thin.
For example, if peak TV was defined by supply far exceeding demand, “too many shows being produced and more options than anybody needed that could actually really benefit the health of the business in the long run,” Aquilina contends.
Because of that consumers may have an easier time finding something to watch — if there are fewer new options coming out every single week.
There may be fewer prestige dramas and comedies being produced, but this could benefit everybody in the industry. That’s because the post-Peak TV landscape will look a lot like the network TV of old: shows with broader appeal, shows with less extravagant budgets, shows with longer seasons, and shows with episodes released weekly.
“This is going to necessitate a less artisanal approach than many signature shows that the PTV era took and it’s going to mean a return to broader sensibilities that define network television. The new era of TV may result in far fewer classic shows, far fewer experiments, less daring shows, but there is a chance it could put Hollywood on a path to getting its business model back on track.”
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