Future of TV Briefing: How the TV, streaming and digital video industry spent its summer

The summer of streaming

Remember going back to school as a kid and seeing that friend who sprouted six inches over summer and had seemingly transformed from child to young adult in a few months’ span? Yeah, this year streaming was that kid.

Streaming has been on a growth trajectory since, well, ever. But this summer traditional TV’s heir apparent hit a growth spurt and has finally come of age. Not only did some streamers finally reach profitability, but streaming seemed to steal the spotlight — if not the lion’s share of advertisers’ spending — in the annual upfront market. Streaming has become such a significant business, in fact, that the judicial system has recognized the threat of the old guard colluding on a streaming service for sports. 

With the TV, streaming and video industry heading into not just a new season but seemingly a new era, let’s look back at what was an eventful summer.

Streaming profits, TV writedowns

Perhaps no week better sums up the industry’s summer than the first full week of August. That week saw Disney and Paramount report their first quarterly streaming profits as well as Paramount and Warner Bros. Discovery take multi-billion-dollar writedowns on their cable TV businesses.

To be clear, despite the opposing trajectories, there’s still a large gap between the size of the companies’ traditional TV and streaming businesses. Paramount’s traditional TV business still notched a $1.0 billion profit for the second quarter of 2024, which is roughly 39 times the profit of its streaming business.

But the dichotomy between the streaming profits and the TV writedowns — between companies beginning to recoup the investments into their streaming services and to recognize the devaluation of their TV networks — reflects the inevitable is in fact underway: Streaming is (in the process of) overtaking TV, not just in audience viewership but in business value.

The streaming upfront

Again, let’s preface this by saying that traditional TV remains the bigger business, including in the annual upfront advertising market. But again, streaming is the growth business, including in this year’s upfront.

Case in point: Disney’s overall upfront haul increased by 5% year over year, but the amount of money specifically earmarked for streaming was up 10% year over year.

More to the point: This year advertisers are estimated to have committed more money toward streaming than to broadcast’s or cable’s primetime TV programming, according to advertising and media consulting firm Media Dynamics, Inc. 

Streaming’s enlarged upfront allotment may have much to do with streaming’s shrinking ad prices. Disney and Netflix each reportedly lowered their CPMs in this year’s marketplace. Price drops aren’t typically a sign of strength, but they can correspond to sellers having more inventory on offer and therefore being able to charge less per ad to secure more money overall. And given that Disney and Netflix each claimed increases in overall streaming ad commitments, that seems to be how things played out.

The streaming playing field

Speaking of things playing out, this summer showed the future of streaming sports will play out, partially, in court. 

That’s where Disney, Fox and Warner Bros. Discovery will have to face a lawsuit from streaming pay-TV service Fubo that has preempted the launch of the companies’ sports-centric streaming service Venu. 

The traditional TV triumvirate seems to be trying to make the case that Venu is incremental and supplementary to existing sports offerings. Which may be true. But NBCUniversal’s Peacock showed this summer how valuable sports can be to streaming services — gaining 3 million subscribers during the Olympics’ first week — and therefore how serious to take that business when it comes to preserving competition.

AI vs. IP

Streaming wasn’t the only story of the summer, though. No chronicle of really any industry at the moment can exclude artificial intelligence. And the theme of AI’s story this summer was consent.

Two companies — Nvidia and RunwayML — were exposed for training their AI models on YouTube videos without creators’ permission nor with creators being compensated. As if creators didn’t already have reason enough to be wary of generative AI.

The not just potential but reality of AI undercutting creators has raised the urgency for creators — for talent writ large — to raise some guardrails around AI usage. Contracts between creators and brands, for example, are being reexamined to ensure they include language protecting creators’ names, images and likenesses from being co-opted by AI.

The entertainment industry union representing actors has similarly taken up the cause. Over the summer, SAG-AFTRA signed a deal with AI company Narrativ for the latter to train its audio model on consenting SAG-AFTRA members’ voices in exchange for compensation.

The soap opera of Paramount’s sale

The saga of Paramount Global’s sale carried on throughout the season. 

First, in June, controlling shareholder Shari Redstone called off the company’s proposed sale to Skydance Media. A month later, the deal was back on. A month and a half after that, Edgar Bronfman Jr. submitted a bid to woo the media conglomerate away from its engagement.

As of last week, Bronfman Jr. dropped his bid, and Paramount closed the window that left the company open to better offers. By all appearances — as of this writing — a year from now Paramount will be a subsidiary of Skydance. Albeit a potentially diminished version of itself. 

Amid the off and on-again sales talks, Paramount has been in process of cutting itself down to size. There was the aforementioned writedown of its cable TV business, as well as renewed interest in selling off its BET unit. Then came the announcement that the company will lay off 15% of its employees. And last Friday, news broke that Paramount reportedly sold off its VidCon creator conference.

Now keep this in mind: Summer doesn’t technically end for another few weeks.

What we’ve heard

“Until viewing figures are robust and the selection of films and programming becomes more premium, Tubi won’t make it on to many plans.”

— The Kite Factory’s Ben Foster on Fox-owned Tubi’s standing with U.K. advertisers

Trend watch: YouTube overtakes Disney’s TV watch time share

Nearly two years after surpassing Netflix to take the leading share of TV watch time among streaming services, YouTube has usurped Disney to become the top overall media distributor in TV watch time, according to Nielsen’s latest Media Distributor Gauge report for July 2024.

Beyond Disney’s dethroning, the second-biggest move of the month was Fox leapfrogging both Warner Bros. Discovery and Paramount to rank the fifth-most-watched company on TV screens.

Numbers to know

-7%: Percentage year-over-year decline in national TV ad spending in July when excluding the Olympics.

2037: The year when ESPN new deal for U.S. Open rights, which starts in 2026, will run through.

What we’re watching: Glossy launches a YouTube channel

Digiday’s stylish sibling publication Glossy has launched a YouTube channel that brings to life the outlet’s coverage of the beauty and fashion industries, including visual versions of its weekly podcasts.

Throughout this week, the channel will be uploading sessions from the recent Glossy Beauty Pop event that featured creators, such as Jackie Aina, Stephanie Ledda and Michelle Phan, discussing their influencer-founded brands.

What we’ve covered

What do advertisers want from Tubi in the U.K.?:

• The Fox-owned free, ad-supported streamer debuted in the U.K. nearly two months ago.
• British ad buyers are waiting for Tubi to prove itself in a saturated market.

Read more about Tubi here.

After keeping them at arm’s length, sports brands are opening the door to creators:

• Last week ESPN and YouTube simulcasted a PGA-backed golf tournament featuring creators.
• More than 80,000 people watched the tournament live on YouTube.

Read more about sports creators here.

What we’re reading

YouTube is TV:

Traditional TV network owners and traditional TV advertisers may be unwilling to accept that YouTube is a form of TV, but YouTube creators continue to make the case with shows like “Hot Ones” and “Chicken Shop Date” as key evidence, according to The Wall Street Journal.

The Trade Desk wants to be a CTV platform:

The ad tech firm is developing a connected TV platform to license to smart TV makers and compete with the likes of Roku and Amazon’s Fire TV, according to Lowpass.

Free streaming is eating TV:

Free, ad-supported streaming services, such as YouTube and Pluto TV, are accounting for growing shares of TV audiences and TV watch time, which not only cuts into viewership for pay-TV and paid streaming services but also potentially their revenues, according to Business Insider.

California nears passage of AI replica law:

The California Senate has agreed to pass a law that would require explicit consent for companies to use AI-generated digital replicas of actors, according to Variety.

Paramount sells VidCon:

Six years after acquiring VidCon, Paramount Global has agreed to sell the creator-centric conference to Informa, the U.K. company that recently agreed to acquire Cannes Lions parent company Ascential, according to Business Insider.