Streaming has Americans more glued to their screens than ever, but it could all come crashing down in the case of a 'content recession,' BofA says

"The change is more about delivery than demand. The Bureau of Labor Statistics' American Time Use Survey shows Americans still devote about five hours a day to leisure, with more than half of that time spent watching TV. But instead of flipping through cable channels, more households are paying monthly for on-demand services. Internal BofA payments data shows streaming video and audio represented more than 10% of spending across all income cohorts as of July,"

"Yet, even as consumer appetite grows, the industry faces a new challenge, writes the BofA team led by senior economist David Michael Tinsley: a possible "content recession." In recent years, providers have dialed back the sheer volume of original shows and films, shifting instead to fewer projects with higher production values. The content recession could be seen in two ways: either a pullback in the number of shows being commissioned, an emphasis on "quality over quantity" play that may keep subscribers loyal to franchise hits,"

"or a recession in terms of the number of must-watch shows being made as streamers embrace a cheaper, mass production, more linear TV-seeming model. As long ago as late 2023, former Amazon Studios chief Roy Price wrote a New York Times opinion piece declaring the era of prestige TV was ending as streaming underwent a fundamental change. BofA analysts caution this could stall growth if viewers feel there isn't enough fresh material to justify rising monthly bills."

Americans spend about five hours daily on leisure, with over half spent watching TV. Streaming platforms have surpassed linear television in viewership share and now rival linear TV and radio combined. Households increasingly pay monthly for on-demand services, and streaming video and audio account for over 10% of spending across income cohorts. Since 2023 streaming spending has outpaced live events, theaters, and theme parks. Providers have reduced the volume of original content, favoring fewer, higher-budget projects, raising concerns of a "content recession" that could increase churn if fresh must-watch material declines.

Read at Fortune