Hollywood’s Existential Threat is Attention:
Or Lack Thereof
Having recently returned from a trip to visit my parents, both in their eighties, allowed me to witness how most of their screen time is spent.
Spoiler alert that won’t surprise anyone; the number one screen is their phones. But it’s not just the screens; it’s the content. Like many other generations with mobile phones, my parents aren’t watching movies or shows on their phones; they are watching an endless stream of short-form videos and clips powered by AI algorithms.
This is not the content Hollywood produces and profits from. The TikTokification of content that is getting the lion’s share of our time and attention means there is less of it left over for Hollywood products. This includes streaming, BTW.
So however the strikes play out, Hollywood will emerge with a supply and demand problem in the works for years. That supply and demand issue translates to a shortage of attention for Hollywood-produced content and a surplus of products.
Hollywood’s monopoly on content has been over for some time, but it has reached an industry existential inflection point. As much as I personally don’t love what the Kardashians pump into the culture—they have been well ahead of the curve in divesting their massive income streams from Hollywood dependence. They don’t need Hollywood and, unlike it, have built a moat around their influencer/creator-architected revenue models.
These strikes aren’t like what happened in the 80s. Actors and writers may think they are fighting the large studios when they are fighting for our time and attention.
And they are losing it…
Hey David, this is a great idea to put forward. I have studied these dynamics a lot throughout my career.
In most industries power tends to migrate toward distribution over time. Closer to the customer means stronger bonds and more channel power. This typical trend can be mitigated if the supplier has a monopoly or de facto unique value assigned to its product by customers (or in the case of the entertainment industry if you get a consent degree imposed on theater chains to limit their ability to wield distribution channel power).
As channel power in suppliers wanes you often see distributors consolidate and increase their power. Distribution then looks for new sources of supply to improve margins and serve their customers. The reduced cost and barriers to content production along with strong centralized distribution for digital content is one cocktail that Hollywood is going to have a hard time keeping down. That is a key reason why the blockbusters and franchises dominate today and "thinking movies" struggle to get even a look by the studios. Scale in terms of demand for a unique product (particularly for overseas markets) is the last card Hollywood has to play.
Good post. “Content” and “attention” can lead to greater engagement, but much of the content is predictable, derivative and you only engage once.
Hollywood is not a monolith of studios but an ecosystem of different corporate owners with different economic models. They do not know collectively how to respond to YouTube, TikTok and many other types of individual influencer content. I agree this content is taking some of our attention but being titillated is different than being committed. Studios produce multi show content we are willing to pay for.
But there are crossovers. The Rock is a successful actor and also a social media influencer who monetizes his brand and fans.