The Great Contraction: Why TV Seasons Are Shrinking And What It Means For The Industry
Today, we’re going to update a story from March about how television seasons across linear and streaming are getting shorter (at least in the United States) and what that means for the industry.
According to Parrot Analytics, the average episode length of a season of network television has decreased from 16.2 in 2018 to 11.8 as of July 2024 while the length of a streaming season in the same span has shrunk from 10.7 episodes to 9.3. What is driving this contraction and why do the major players believe that content alone is the answer?
Some of the catalysts are obvious: rising production costs, declining linear ratings, plateauing subscription growth, rampant churn and a shrinking advertising market for linear are all major contributors. The economics of longer-running series are harder and harder to maintain these days. We’re two years removed from the concluding chapter of the low interest rate spending spree that fueled an entire industry to desperately chase Netflix’s juicy share price multiple. This trend is evident in the decline of new English-language TV series that have aired across broadcast, cable and streaming per year, which declined in 2023 for the first time (excluding the pandemic-disrupted 2020) in more than 14 years.
Peak TV truly peaked in 2022. Consumers will never have as much high quality choice as they did then. Engagement drives retention. Naturally, that means less volume and shorter seasons creates more burn and churn as there is less to consume. This is one reason why cancellation rates were up industry wide in 2023 and why linear revenues continue slipping. To fight back, we’re seeing a rash of cross-company bundles hit the market in hopes of improving retention. But this feels more like a band aid than a necessary surgery.
Content is no longer king in Hollywood and beyond. More is needed to consistently convince consumers of your value proposition.
Better content recommendation algorithms that strategically nudge consumers in and out of their core interests, based on consumption affinity, can help extract the full value of a four quadrant library. This can help improve retention following the conclusion of a seasonal growth event like House of the Dragon or the Olympics. Carefully scaling and distributing niche interest services can help differentiate yourself from a sea of general entertainment, similar to how Crunchyroll and Shudder have carved out space for enthusiast fandoms. Loyalty programs can incentivize long-term subscriptions and build consumer affinity. Flexible subscription plans with varied pricing tiers can help meet diverse customer needs. Improved user experience and interface, multi-device compatibility, interactive features and social integration, and unique promotional and bundling strategies all play definitive roles in churn reduction.
Netflix co-CEO Greg Peters is arguably the only entertainment media leader with a technology/coding background. That is not a guarantee of success and he’s deliberately been partnered with content maven Ted Sarandos. But Netflix is thinking differently about its present and its future. That’s reflected in the growing flexibility of its offerings regarding season length, mixture of binge and batched releases, and leading UX/UI.
The background of every major hire and/or appointment in this industry speaks to the strategic thesis of a company. Right now, legacy media is at a real disadvantage despite their century old libraries of programming and intellectual property. To succeed today, you need to think beyond just programming and better understand audience behaviors and rapidly changing technology. That’s especially true when you’re giving audiences less and expecting them to pay more.
