Streaming Trends to Watch in 2021: Consolidation, Ads vs. Subs and Mobile Content Wars

Sam Blake

Sam primarily covers entertainment and media for dot.LA. Previously he was Marjorie Deane Fellow at The Economist, where he wrote for the business and finance sections of the print edition. He has also worked at the XPRIZE Foundation, U.S. Government Accountability Office, KCRW, and MLB Advanced Media (now Disney Streaming Services). He holds an MBA from UCLA Anderson, an MPP from UCLA Luskin and a BA in History from University of Michigan. Email him at samblake@dot.LA and find him on Twitter @hisamblake

Streaming Trends to Watch in 2021: Consolidation, Ads vs. Subs and Mobile Content Wars

Everyone expected the streaming wars to heat up, but no one could have predicted that a global pandemic would upend the theatrical release window and reshuffle the entertainment landscape so dramatically moving into 2021.

While Netflix has retained its dominance, Disney Plus is catching up. WarnerMedia-owned HBO, once the king of cable, has struggled to lure subscribers to HBO Max, but made headlines by throwing the long-entrenched precedent of films debuting on the big screen out the window.

NBCUniversal joined the fray with Peacock while the much-anticipated Quibi quickly burnt out. It remains to be seen whether the vast array of niche services can survive. Meanwhile, cash-rich Amazon and Apple loom with fat balance sheets, setting them up to make big moves if they wish.

With 2020 receding into the rearview, here are three trends to watch in 2021.


Will Streaming Platforms Consolidate Through Mergers and Acquisitions?

The proliferation of direct-to-consumer streaming platforms has precipitated a content arms race. Streamers need to keep filling their pipes if they want to compete and they are looking to old favorites like "The Office," zeitgeist-capturing breakout hits like "The Queen's Gambit" and reliable franchises like "Star Wars" and "Marvel" that can spin off seemingly endless films and shows.

Meanwhile, the pandemic has brought the future of theatrical releases and even theater chains into question after Warner Bros. allocated their entire slate of 2021 films to a streaming release the same day the flicks debut on the big screen. If box office dollars shrivel and sales of the films released directly to streaming are strong, streamers will continue to look to this model as a viable option even after the pandemic subsides. This could add challenges for companies with strong libraries and production chops but lacking a premier streaming platform.

"How do you greenlight a $100 million movie if you don't know what it's going to look like when the lights turn on?" said Adam Goodman, former president of Paramount Pictures.

Related: The Economics of How and Where Movies Are Released

Those companies may be better off paired with one of streaming's established players. The Wall Street Journal recently reported MGM, which owns James Bond among other assets, is looking to sell. Who might be buying?

Apple and Amazon could pay cash for virtually any studio in town and still have money left over. Their interests in streaming are tied to selling other products and services, though, so their acquisition appetites will depend on how badly they think they need to make a move in order to retain and grow their respective competitive advantages. 2021 may reveal the size and scope of their ambitions.

Another area to watch is how the ongoing decline of cable TV may nudge WarnerMedia and NBCUniversal toward spinoffs from their corporate parents, AT&T and Comcast respectively. Some activist investors have been calling for this, in order to free up the cable companies to focus on their super high-margin internet service businesses. One intriguing possibility is a two-step shakeup, in which WarnerMedia spins off from AT&T and NBCUniversal spins off from Comcast, and then their two streaming platforms (HBO Max and Peacock) merge to take on the behemoths of Netflix and Disney Plus.

Then there are the niche services. Sony recently acquired Crunchyroll for $1.2 billion. Might we see more roll-ups into broader-serving platforms?

Can an Advertising-Based Service Compete with a Subscription-Based Model in Streaming's Upper Echelon?

With the exception of Hulu, which has lost some of its luster as Disney has assumed full control and prioritized Disney Plus, the big players in streaming have primarily been subscription-based.

NBCU's Peacock, however, went against the grain by offering both a free, ad-based tier and a premium subscription. Providing free service can help to attract younger audiences strapped for cash, but it remains unclear whether the model can generate enough revenue for Peacock to afford enough content to compete with Netflix and Disney.

To track how NBCUniversal is thinking this through in 2021, keep an eye on the extent to which Peacock invests in content and marketing for its free tier. A significant push in those areas could indicate that its ad business is doing well. Specifically, it'll suggest that Peacock can target ads with relatively high precision, and charge advertisers a premium.

Might Someone Pick Up Where Quibi Left Off, with a Twist?

Although Quibi flamed out spectacularly, it's possible that Jeffrey Katzenberg was onto something: there's arguably an underserved gap between premium content on streaming platforms and user-generated content (UGC) on mobile apps like TikTok, Snapchat and Instagram. Quibi tried to bridge that gap by combining mobile with premium, shelling out for big-name stars and charging users a subscription fee. The pandemic may have exacerbated Quibi's demise, but so did the bevy of alternative short-form video platforms that are free and just a thumb-tap away.

The question, then, is whether the gap that Quibi identified can be filled in another way. As to what that might look like, media analyst Laura Martin told dot.LA that the lesson of Quibi's downfall is that UGC models appear to be "more resilient" when it comes to mobile content.

Rather than turning mobile video into studio-quality content, 2021 could see a premium take on free-to-access UGC content. For example, influencers with big followings may start creating more series with narrative arcs and content with higher production values. It's a model that's been tried to an extent before, unsuccessfully, with Disney's failed acquisition of Maker Studios and the lackluster results of YouTube Red. But with the pandemic increasing consumption of social media and time spent on mobile devices, the environment has changed. Plus, as the influencer economy and ecommerce evolves, new business models and funding sources are emerging, which could open up a new realm of creativity in 2021.


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Sam Blake primarily covers media and entertainment for dot.LA. Find him on Twitter @hisamblake and email him at samblake@dot.LA

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🍵☕️Top 6 Coffee Alternatives for Enhanced Productivity

In the fast-paced world of startups and venture capital in Los Angeles, maintaining peak productivity is essential for founders and investors alike. As the hustle intensifies, many are seeking alternatives to traditional coffee that not only provide a sustained energy boost but also support overall health and well-being. The following list highlights some of the top-rated coffee alternatives that can enhance focus and productivity while minimizing the adverse effects of caffeine. These options incorporate adaptogens, superfoods, and gut-friendly ingredients, making them ideal choices for those looking to optimize their performance without the afternoon crash.


Matcha

Image Source: Jade Leaf Matcha

Matcha is a finely ground green tea that offers a moderate amount of caffeine, along with L-theanine, which promotes relaxation without drowsiness. This combination can enhance focus and concentration, making matcha a suitable alternative for those looking to boost productivity without the jitters of coffee.

Popular Brands: ReNude Chaga Matcha (60 mg caffeine), Golde Pure Matcha (60 mg caffeine), Organic Ceremonial Matcha - Teahouse Edition (30 mg caffeine)


Dandelion Root Coffee

Image Source: Amazon

Dandelion root coffee is a caffeine-free alternative that mimics the taste of coffee. It is known for its potential to support liver health and digestion, which can contribute to overall well-being and productivity. The drink can help avoid the acidity and jitters that often accompany regular coffee, making it a gentler option for those sensitive to caffeine.

Popular Brands: Dandy Blend (0 mg caffeine), Teeccino Dandelion Dark Roast (0 mg caffeine)


Adaptogenic Drinks

Image Source: MUD\WTR Masala Chai

Adaptogenic beverages, which include ingredients like ashwagandha, reishi, and maca, are designed to help the body adapt to stress and promote mental clarity. These drinks can provide a sustained energy boost without the crash, supporting productivity throughout the day. They are often made with superfoods and spices that enhance both physical and mental performance.

Popular Brands: MUD\WTR Masala Chai (35 mg caffeine), Four Sigmatic Think Coffee (150 mg caffeine), ReNude Chagaccino (0 mg caffeine)


Golden Milk (Turmeric Latte)

Image Source: Golde

Golden milk, made from turmeric, ginger, and milk (or a milk alternative), is a caffeine-free option that can improve mood and reduce inflammation. The calming properties of this drink can help maintain focus and clarity, making it a great addition to a productive morning routine.

Popular Brands: Golde Turmeric Latte Blend (0 mg caffeine), Blume Turmeric Blend (0 mg caffeine), Four Sigmatic Golden Latte Mix (0 mg caffeine)



Chicory Root Coffee

Image Source: Teeccino

Chicory root coffee is an excellent alternative that satisfies the desire for a warm beverage without caffeine. It is rich in inulin, a prebiotic fiber that aids in digestion and promotes gut health by supporting beneficial bacteria. Chicory coffee has a nutty, earthy flavor and can help control blood sugar levels, contributing to overall energy and productivity throughout the day.

Popular Brands: Anthony’s Instant Chicory Root (0 mg caffeine), Teeccino Chicory Coffee Alternative (0 mg caffeine)


Yerba Mate

Image Source: Guayaki Yerba Mate

Yerba mate is a traditional South American herbal tea made from the leaves of the Ilex paraguariensis plant. It contains about 40-80 mg of caffeine per serving, which is less than a standard cup of coffee but enough to provide a gentle energy boost. Yerba mate is rich in antioxidants, vitamins, and minerals, and users often report feeling energized without the jitters or crashes associated with coffee. It has a unique, slightly bitter flavor and can be enjoyed in various forms, including loose-leaf tea and pre-brewed options.

Popular Brands: Guayaki Yerba Mate (40-150 mg caffeine)


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LA’s Data Center Supply Crunch

🔦 Spotlight

Happy Friday Los Angeles!

The Los Angeles data center market is experiencing a significant supply crunch, ranking 12th in growth among top markets since 2020 with only 265 megawatts of colocation inventory (data centers where businesses rent space to store their computing hardware and servers). Despite this, demand is surging, driven by AI, cloud, and hyperscaler needs, with AI accounting for 20% of new data center demand nationally. This scarcity is creating a highly competitive environment, with vacancy rates at a record low 3% and asking rents rising 13-37% year-over-year. For Los Angeles, this presents both challenges and opportunities in the big picture. The city's strategic position as a global entertainment hub and its connectivity to international markets through subsea cables make it an attractive location for data centers. However, the limited inventory and rising costs could potentially hinder growth and innovation in the tech sector. To maintain its competitive edge, Los Angeles will need to address these constraints through new developments, such as GI Partners' 16 MW addition at One Wilshire, and by focusing on high-connectivity, high-power capacity submarkets. The city's tech community should prepare for a landscape of increased competition for quality data center space, higher costs, and the need for innovative solutions to meet growing demand, particularly in AI and cloud services. While Los Angeles faces a challenging data center supply crunch, its strategic advantages and ongoing developments offer a promising path forward.


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LA Companies

  • Daisy, a one-year-old startup that designs and installs smart home and office technology systems, raised a $7M Series B co-led by Goldcrest and Bungalow, with previous investors Bullish and Burst Capital also stepping up. The company has raised a total of $13.3 million. - learn more

LA Venture Funds


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    🌐Decentralizing Data & Vacations: Sony's Web3 Leap and Sensible Weather's KOA Partnership

    🔦 Spotlight

    Happy Long Weekend Los Angeles!

    Sony Group is making a significant push into the blockchain and Web3 space, leveraging its Sony Pictures and Sony Music divisions along with a new global incubator. The company has developed the Soneium blockchain through Sony Block Solutions Labs, a joint venture aimed at accelerating Web3 innovation. Sony is launching the "Soneium Minato" public testnet and a developer incubation program called "Soneium Spark" to foster ecosystem growth and adoption. The initiative includes strategic partnerships with Web3 companies such as Astar Network, Circle, and Optimism. Sony aims to create a fan community centered on creators and connect diverse values through Soneium, with the ultimate goal of integrating Web3 services into people's daily lives. While the company acknowledges the challenges faced by Web3, including limited user adoption and the need for mainstream use cases, it remains committed to decentralizing the concentrated power of the current internet landscape.

    In completely unrelated and more digestible news Sensible Weather, a leading weather protection provider that we’ve featured many times, has partnered with Kampgrounds of America (KOA) to offer Weather Guarantees at over 450 KOA Campgrounds across the United States. This collaboration allows campers to purchase weather protection for their outdoor experiences, providing peace of mind and potential reimbursements of up to 100% of their nightly rate if weather conditions exceed predefined parameters. The partnership comes at an opportune time, as camping has seen a significant increase in popularity, with active campers growing by 68% over the past decade. If you are looking to do some camping this fall make sure you look into Sensible Weather protections to ensure that unpredictable weather won't dampen (nailed it) your camping experience.


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    LA Venture Funds

    • Fika Ventures led a $4.55M Seed Round for Revenew, a San Francisco startup that aims to help digital platforms and marketplaces manage their payments and optimize financial operations. - learn more
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      ✨ Featured Event ✨

      LA TECH CEO SUMMIT

      LA’s tech leadership is set to reunite after a long break! This two day summit will focus on building strong connections, sharing insights, and fortifying the local tech community.

      Learn More Here

      Register Here


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