NBCUniversal, the television and film studio, owns Fandango, the movie ticket and lesser-known digital movie streaming service, FandangoNow. Vudu, owned by Walmart until they sold to Fandango via NBCUniversal, is a 100,000-movie title video-on-demand service in “100 million living room devices with a mobile app that has had more than 14 million installs”, will now be added to NBCUniversal’s Peacock as another other digital offering. There are three things this purchase signals.
- Walmart and FOX made similar moves
Remember when FOX (20th Century FOX and other properties) sold their entertainment assets to Disney because they did not wish to compete in the film, television, and streaming space. Walmart made the same decision despite a brief stint in the space to sell its assets and instead pivot to focus on its main business, retail. Walmart did have ambitions of pursuing content and streaming in the digital space, similar to Amazon Prime and Disney+, but ultimately like FOX decided it was better to sell. FOX’s stock has been up since the sell and has even seen gains during the government-led COVID-19 shutdown.
- What does the deal say about the Industry?
In years past, the Paramount Decrees separated movie-making from theater-watching. That line continues to get blurred through industry consolidation. NBCUniversal purchased Fandango, again a theatrical movie ticket company, in 2016. That purchase included a deal to control the now-named FandangoNow streaming service. The direction of the industry in terms of shortening theatrical windows, adding more streaming options, and pushing the direct-to-consumer business can be summed up in three reasons: consumer interest, available technology, and a pandemic that forced businesses to adapt now. The perfect storm, so to speak, in allowing businesses to meet consumers where they what want to watch content.
- Where does NBCUniversal go from here?
NBCUniversal is filling its war chest. NBCUniversal’s current competitors are Amazon, Netflix, Hulu, HBO Max, Disney+, and possibly others. NBCUniversal needs content and taking out a competitor, while simultaneously adding 100,000 movie titles is a no-brainer for the company and its stockholders. Consumers will stand to benefit by seeing more accessible content in one place because the one thing the industry is not doing right now is consolidating to make streaming easier. On the other hand, Amazon and Roku are in great places as hosting platforms, as are those streamers that license their content on other platforms (in addition to their own platforms, where applicable), because that is where the majority of people will flock to consume content. There has been some free and shared content (see HBO Unlocked on Hulu), but otherwise coming out on the positive side of this pandemic streamers will need to think about how to reach customers when they no longer have as much free time or the finances to carry more than three paid streaming subscriptions.