this post was submitted on 14 Nov 2024
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Explain Like I'm Five

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ELI5 How come streaming service are now running commercials? Is that not bad for business because most if not all people got it to avoid commercials? (self.explainlikeimfive)
submitted 1 month ago by Don_Dickle to c/explainlikeimfive
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[โ€“] [email protected] 4 points 1 month ago* (last edited 1 month ago) (1 children)

That isn't really possible to calculate for as you don't know how many people will buy 'XYZ' until after the fact.

Say two separate movies cost $1M to make and only 5k people watch Movie A while 100 million people watch Movie B. According to this, Movie A would need to cost $200 per copy, while Movie B would cost $0.01. The "full price" would be constantly fluctuating so how could you apply it to the first hundred people who watch the movie? What about the last hundred to watch it?

Full price is just code for "what we want" not necessarily what it takes to recoup their investment. These companies want profit and they want every release to be as popular as something like End Game so they're going to claim "full price" is whatever it takes to reach that $10 billion goal.

[โ€“] [email protected] 1 points 1 month ago

It is possible to price because studios are playing the odds. They might make money on one show but lose money on three others. Uncertainty gets baked into a lot of the initial decisions.

And we are seeing that production budgets are getting slashed on television shows compared to a decade ago because the streaming money doesn't compare to cable money.