By Hernan Lopez.
Companies mentioned: Amazon, Bytedance, HBO, Meta, Netflix, Paramount Skydance, YouTube.
Questions answered: What were the main takeaways from the Vertical Media Summit? How do streamers solve the Innovators’ Dilemma with vertical video? Why is AI scaling faster in vertical than TV and Film?
Special note: This is a public version of the Streamonomics® newsletter. I send an exclusive version to clients one day in advance, which includes more in-depth analysis, access to Owl & Co proprietary research, and opinions not included in the public version. If you work for an Owl & Co client (or would like to become one), just reply.
“Microdramas, they’re sort of gamified soft porn.” That was a leading streaming executive to a room full of analysts after an upfront presentation last month.
From TV to YouTube, every major shift in what people watch was met with derision at first. Even Netflix. Before Ted Sarandos made that bold $100M House of Cards bet in 2011, leading showrunners did not have Netflix as their preferred destination for a new pitch.
It’s a textbook case of the innovators’ dilemma: Disruptors start with use cases deemed too small, niche, or anti-economical for incumbents to bother. Streaming dismissed early YouTube just as traditional TV dismissed early Netflix. However, behind that funny putdown of microdramas—which is only funny because it’s grounded in elements of reality—there is some obvious tension...