The Emmy award-winning series, Hacks, is back with new episodes streaming now. The new
season follows Deborah Vance making a move from her Vegas residency to Hollywood show biz. Tensions rise as Deborah and Ava try to get their late night show off the ground, and make history while doing it. Starring Jean Smart and Hannah Einbinder, watch new episodes of Hacks Season 4, Thursdays at 9pm, exclusively on Max.

LEARN MORE

Subscriber growth still matters, of course, but the most important metric in the
streaming industry is efficiency—defined as the revenue generated per dollar spent on content—something both financial analysts and content teams obsess over. Netflix’s efficiency rate has increased by 35 percent between 2021 and 2024, from 1.7 to 2.3, according to Bernstein, largely due to investment in local-language fare and the high-engagement return on licensed content like Suits and Grey’s Anatomy. Naturally, these two growth areas haven’t gone unnoticed
by Netflix’s competitors. Warner Bros. Discovery C.E.O. David Zaslav won’t stop talking about Max’s internationalization strategy, but the focus there is on creating partnerships for Max with companies like Sky, for example, instead of making sizable production investments in various countries. To compare, Netflix is “producing in over 50 countries” as of today, per the company’s report. 

Of course, improvements in “efficiency” depend on whether the core business is growing without having to employ aggressive customer acquisition tactics, such as significant discounting and juiced content spend. By comparison, Disney’s net customer additions across Disney+ and Hulu have slowed considerably despite wholesale deals with Charter, bundling with Max, and big discounts like a recent $2.99/month offer. Somehow, Disney+ lost subscribers in
its international markets through the first three quarters of 2024, while domestically, Disney+ has struggled to crack more than 1 million new subscribers each quarter—and that’s in quarters where there aren’t sub losses. WBD is aiming for 150 million D.T.C. subscribers by 2026, up from the current 117 million, by leaning on international markets for Max. But again, that number also includes linear HBO customers. As with Disney, much of the Warner Discovery profit is on the back of
substantial cuts, not content innovations. 

NBCUniversal is still in the red on Peacock, and growth continues to slow. Although Peacock maintains the largest percentage of customers who choose an ad-supported tier in the U.S. (78 percent, per Antenna), its overall engagement is among the lowest, failing to crack 1.5 percent of all time spent with streaming in the U.S. in every non-Olympics month this
past year, per Nielsen. The narrative about people signing up for an NFL wild card game and sticking around for Ted and Poker Face is a Hollywood fable. Paramount+, meanwhile, has not-so-quietly reported one of its best years, adding more than 5 million customers in its most recent quarter, and a total of 10 million in 2024. Not to mention that Par+, courtesy of Taylor Sheridan, accounted for five of the 20 most streamed dramas in March of this year, per
Luminate. But churn remains a problem that Paramount executives will have to combat as they build toward the profitability levels the Street wants to see.

So the real story behind Netflix’s decision to omit subscriber numbers isn’t about defensiveness. It’s the opposite. Netflix’s competitors keep reporting subscriber growth because they don’t have other good news to share. It’s much easier to cut costs to show profit than
to build a global product that hundreds of millions of people are willing to pay for—and extensively use—each month.

Unfortunately for the legacy companies, Netflix no longer reporting subscriber numbers points to an
even more daunting truth: Sub growth as a metric will matter less and less, in part, because Netflix is no longer the only competition. Free video services, like YouTube and Facebook, were once derided as unprofessional garbage heaps. But now they’re commanding more attention and slowly diluting the value of the content that the premium streaming companies are trying to get people to pay for. Especially with A.I. tools lowering barriers to entry, it’s never been cheaper or easier to
produce high-quality content.

The Emmy award-winning series, Hacks, is back with new episodes streaming now. The new
season follows Deborah Vance making a move from her Vegas residency to Hollywood show biz. Tensions rise as Deborah and Ava try to get their late night show off the ground, and make history while doing it. Starring Jean Smart and Hannah Einbinder, watch new episodes of Hacks Season 4, Thursdays at 9pm, exclusively on Max.

LEARN MORE

Facebook—which, alongside sister platforms Instagram and WhatsApp, reaches more
than 40 percent of the Earth’s population each month—has seen video in the U.S. go from occupying a small portion of users’ time to the majority of it, per this graph that the company recently disseminated. 

And yet, Facebook is just part of the problem. In the U.S., YouTube accounts for more time spent watching content on televisions than Peacock, Max, Paramount+, Tubi, and the Roku Channel
combined—and it’s also growing its YouTube Shorts business (for mobile-friendly audiences), and it’s the “new” home of podcasting. If attention is finite, YouTube is capturing an ever-larger slice of the video-watching pie. And unlike these legacy media players, it’s part of a $2 trillion market cap behemoth.

In the battle for video engagement, these tech companies were easy to dismiss at first because they invest practically nothing in their
content, which is all generated by users. But that flexible cost model has allowed them to invest heavily in optimizing the user experience, discoverability, and all the algorithmic hacks that keep people addicted to their platforms. Don’t get me wrong: Social video and short-form video won’t replace the need for premium subscription services. But their ascent will hasten a vicious cycle for non-Netflix streamers: more cancellations, fewer advertising dollars, and less room to increase prices to
offset new investments. That’s the real story, not whether Netflix tells us how many subscribers it has.

Thanks, Julia. I’ll see everyone on Monday. Happy Easter.

Matt

Got a question, comment, complaint, or other franchises for Mikey Madison to pass on? Email me at Matt@puck.news or call/text me at 310-804-3198.

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