As Barbenheimer Triumphs, a Legacy Content Library Waits in the Wings

5 Min Read

Your feeds have no doubt been painted pink and black as the world is dazzled by the releases of “Barbie” and “Oppenheimer” this past weekend (affectionately named Barbenheimer…oh, how we missed the couple names of the early ‘00s). While theaters reveled in the post-COVID return to blockbuster events, strikes are already affecting their upcoming slate of content. Luckily, trusty streaming channels are standing by with an enormous library and new ad-supported tiers that make it easy to jump right in. Here are some of the industry’s biggest shifts this week.

Old: Going to the Movies
New: A Double Feature of Barbie and Oppenheimer

It goes without saying that last weekend was dominated by the release of Barbie and Oppenheimer. The success of two original stories—a period piece and a film based on a toy, certainly, but neither sequels nor additions to lengthy franchises—signals a real shift in what will get viewers off the couch and into the theaters.  

During the pandemic, movie theaters suffered, and many figured it was the end of moviegoing as we know it. However, as things began to open up, it was beloved franchises that lured movie-goers back to theaters. 2021 was rife with successful franchises (more about that here). This year, viewership is shifting back to the pre-pandemic trend of getting people to the theater for…really great content. 

“Barbie” and “Oppenheimer” not only exceeded their individual projections but also bolstered each other, creating a fan movement and a record-breaking weekend. The New York Times reports: “The blockbuster turnout signaled that Hollywood has finally bounced back from the pandemic. All told, North American multiplexes had their biggest weekend since ‘Avengers: Endgame’ arrived in April 2019.”

Old: Watching Ads to View Your Favorite Content
New: Watching Ads to View Your Favorite Content on Netflix

Theaters may be busy shifting back to content that wow’s but content itself isn’t the prime focus for everyone, especially when it comes at the expense of revenue. Netflix announced this week that they’ll be eliminating their basic subscription tier for new members, in the hopes that new users will opt for their ad-supported subscription tier instead. While analysts are skeptical of the tactic, Netflix’s ad-supported tier has boasted 1.5MM sign-ups to date, more than originally anticipated. Throughout the pandemic, streaming giants focused on content, often at the expense of revenue. However, that’s shifting with the renewed focus on monetizing users. “We forecast Netflix US ad revenues will be $770m this year and $1.07bn next year,” noted Ross Benes, a senior analyst at Insider’s eMarketer. “While that is a small portion of total US CTV plus TV dollars, Netflix is just getting started. Its viewership rivals any company’s, which means it holds significant ad revenue potential.”

MNTN CEO Mark Douglas highlights that this shift back to ad-supported viewing is something that mirrors TV watching of seasons past. “Netflix has figured out that ads monetize better than subscriptions below certain price points,” he told The Drum. “It makes complete sense to give their customer the widest library of content they can and do that profitability to pay for it. Entertainment consumers intuitively understand that because they’ve gotten free content for years on major TV networks.”

Everything old is new again—not just the story of a World War II scientist or a doll released in 1959. Viewers are going back to their old ways, shelling out for popcorn to see new movies in theaters, while streaming channels are coming around on the old-school value of ads rather than relying on subscriptions alone. 

Old: A Writers’ Strike Slams Content Pipelines
New:  Writers’ and Actors’ Strikes Slam Content Pipelines

Just as these viewership trends have started to stabilize, Hollywood went on strike: first, the writers back in May, followed by the actors in July. The strikes—and the studios’ intentions to wait them out—have already slowed the usual rollout of content. Movie releases have been delayed in anticipation of the slowing influx of titles; Challengers, a film starring Zendaya that was set to release in September, has now been pushed to April 2024. The diminishing new releases may stop the return-to-theaters trend in its tracks. As the NYT mentions, “Studio executives have long pointed out that moviegoing begets moviegoing—that the habit of watching movies in theaters is crucial.”

Movie theaters won’t be the only ones to suffer. New TV and original content will also start to fizzle out as the strike continues. This is where streaming has the advantage, however. In terms of new content, we can look to the 2007-2008 writer’s strike to predict what we’ll see: reality and competition-based shows without written scripts or professional actors. And international content’s increasing popularity means streamers will be looking abroad for scripted content, too. Beyond this new content, however, are the vast libraries that streaming services already have. Whether it’s rewatching favorite sitcoms like “Seinfeld” or catching up on series until new seasons can be filmed and released, viewers will find something to watch.

Old: Seinfeld, Game of Thrones, Squid Game
New: Rewatching Seinfeld, Game of Thrones, Squid Game

This is where streamers who have introduced an ad-supported tier are set up for success. As content continues to taper off and consumers look for new (old) content to watch, they’ll be ready to dip their toes into back catalogs of channels unfamiliar to them. Faced with multiple subscription fees, viewers are already finding the price break of an ad-supported tier more enticing. 

MNTN CEO Mark Douglas also made an important distinction between free, ad-supported channels (sometimes known as FASTs) and platforms that still require a subscription fee. “Free ad-supported plans are needed, because most consumers don’t want to pay for more than three or four subscriptions,” he told the Drum. “But the pure ad-supported plans won’t have as many new shows, and that’s a tradeoff that most consumers don’t seem ready to make. They want the new shows that create cultural moments, like ‘Game of Thrones,’ ‘Squid Game,’ or ‘The Handmaid’s Tale,’ and they want something interesting every time they turn on the TV. Ad-supported plus subscription services are the most likely to provide the big content libraries needed to deliver both.” As streamers wait for the newest content, they’ll have a wealth of high-quality content to rewatch or finally catch up with.

Rewatches and Ad Breaks: Ain’t Broke, Don’t Fix

People are back to their old content-consuming ways, whether that’s driving to the theater or sitting through ad breaks. The content pipeline may soon sputter to a stop due to the strike, but there is nearly endless content to (re)explore. For our part, we can hardly wait to rewatch Barbie and Oppenheimer when it becomes available to stream.