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No, not that one. Apple TV+ became the first streaming service to win the Best Picture award at the 2022 Oscars, and that is a huge change in the industry. But can we sustain the costs?
So, after five years of trying, a streaming service finally won the Best Picture award at the annual Academy Awards. The fact that this has all been overshadowed by slap gate — and no, we’re not going to even begin to unpack that one — is unfortunate, as it truly is a significant moment.
Perhaps the main surprise is that it’s Apple TV+ that eventually broke through and won with CODA. Amazon was the first off the streaming services to pick up a nomination in 2017 for Manchester by the Sea in 2017, but it is Netflix that has picked up a whole string of nominations and seems to have been trying hardest. The list of its nominees over the past few years includes Roma, The Irishman, Marriage Story, Mank, The Trial of the Chicago 7, and Don’t Look Up and The Power of the Dog this year alone.
Missing out, especially with the widely tipped The Power of the Dog, can’t be an easy pill to swallow.
But the fact that three streaming films were nominated this year (out of 10 contenders) is a record in itself. And that reflects the amount of money that is being invested in streaming movies as the services look to establish both a competitive advantage over each other and a degree of critical acceptance along the way.
To be clear, Apple did not make CODA, it bought the global rights to it for $25 million in a frenzied bidding war after it premiered at the Sundance film festival in January 2021 (and incidentally, seems to have then had to go on to buy out the pre-sold rights to the international territories that helped finance production). All in all it’s been an expensive purchase. Variety reckons that it then spent about $10 million on the Oscars campaign to get it at the front of judges’ minds — which means that in the final tally it spent over three times marketing and distributing the movie than it cost to make (somewhere roughly under $10 million).
The problem is it all costs
The streaming services’ pursuit of the Oscars though is just one facet of a content arms race that is spiralling up into the sort of figures normally associated with moon landings. Indeed, Netflix’s yearly content budget alone is approaching $20bn, enough to launch two James Webb Space Telescopes, and as a consequence of this and everybody else’s spending, prices are going up for viewers round the world.
Research done in the UK suggests that the price of watching everything — that’s the main streaming services plus the main Pay-TV ones and the broadband to access it all — is currently up at around £2500 ($3300) per year. What’s more, that’s a 22.5% increase over the course of just three years as new services launch, rights change hands, and more. And price hikes of around 10% are probably on the cards for this year. Netflix’s have already risen…Its premium tier in the US now costs $19.99 and was ‘just’ $11.99 eight years ago. That’s a 67% jump. If it had risen purely in line with inflation that cost should be approximately $14 now.
The $64 billion question is how inelastic consumer demand is. Is Netflix something that consumers must have month in, month out? Or are they liable to start chopping and changing, stacking a certain amount of services and flexing them depending on what content is dropping on a particular month. So far the research has been inconclusive, but as the cost of living rises in more than one country, the streaming services may well find themselves under pressure and subscriber churn increasing.
The audience at home
Currently though, Apple has accomplished something unique. Having snagged the Oscar, it probably sees its $35m or so outlay as money well spent, despite ending up as being only the second most reported story of the night. But it does illustrate how the power balance is shifting in Hollywood and elsewhere There was something else unique about this year’s ceremony that is also well worth pointing out. If you lived in the US, you were able to see all ten movies nominated for Best Picture ahead of the ceremony in the comfort of your own home, either via SVOD services or TVOD. No more schlepping to the cinema or anything as vulgar as that just to catch the Oscar nominees.
An Oscars ceremony where movie theatre attendance is more of an added bonus than an integral part of proceedings? Maybe, a bit like ABC following the Will Smith slap, movie execs might want to cut away for a short while.
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