The Streaming Bundle Economics Reset
Bundling was supposed to fix churn. Instead, it's quietly compressing the take rate that made direct-to-consumer streaming attractive in the first place.
Noah Kessler
Analyst, Consumer
Overview
The re-bundling irony
Streaming bundles are succeeding at their stated goal of reducing churn. They are less successful, so far, at preserving the per-title economics that made unbundled direct-to-consumer distribution attractive to content owners in the first place.
The near-term takeaway
The market appears to be rewarding churn improvement without fully pricing the associated take-rate compression, particularly for smaller content owners with less negotiating leverage inside these bundles.
Disclaimer
This report is published for educational and informational purposes only. It is intended to help readers understand businesses, industries, and valuation frameworks, and does not constitute investment, legal, or tax advice, or a recommendation or solicitation to buy, sell, or hold any security. It does not include buy, sell, or hold ratings, price targets, expected returns, or personalized investment recommendations of any kind. Elevate Research is not a broker-dealer or registered investment adviser. The views expressed are those of the author as of the publication date and are subject to change without notice. Past performance is not indicative of future results. Readers should conduct their own due diligence and consult a licensed financial professional before making any investment decision.
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