The capitalist mindset is that competition creates innovation and, as a result, better conditions and options for customers. Those with the best products and services rise to the top in these competitions because customers gravitate to the offerings with what they deem to be the best for what they want and need.
Recently, entertainment tech companies have come under the spotlight, especially those associated with “Big Tech.” Some of this has been due to the swathes of layoff rounds, while others concern massive acquisitions.
Tech companies have been consolidating for several years now, with the process seemingly accelerating to a fever pitch since the turn of this decade. This is especially visible in entertainment circles.
Prime Video has gobbled up major Hollywood studios and gaming companies are acquiring studios left and right. Easily the most high-profile of late, particularly due to the fuss it’s created among global regulators, is Microsoft’s $68.7 billion acquisition of Activision Blizzard.
Here, we’re looking into the state of competitiveness in modern digital entertainment industries and how it’s impacting customers.
Where heated competition can work for customers
In theory, a crowded space in entertainment can only truly benefit customers if there’s a strong sharing of content, there are several world-class content providers, and there are several facets in which platforms can compete.
This way, regardless of where the customers go, they can usually get the same or a similar entertainment experience, but the decision can come down to preference elements. This could be the site layout, quality of the app, payment methods available, regularity of library updates, or other additions like promotions and loyalty schemes.
Where there’s a good spread of quality entertainment product creators, and they each deliver those products to perhaps hundreds of sites, other elements beyond the fun that may even be more important overall become the focus.
So, the platforms have to step up in user quality areas, with one of the most notable battlegrounds to arise as a result being the casino bonus. Now a new player to a site can expect a bonus that will either give free spins or match their deposit to allow them more time with the entertainment products.
This idea of offering something for free to newcomers is a proven idea drawn from the much more rudimentary practice of giving free samples or offering a buy one, get one free deal on new products.
Beyond this, to get good review scores, platforms need to offer trusted payment methods, have smooth-running websites and apps, have good customer support options, and be licensed and regulated. As the software remains similar across the board, it’s these important elements that some entertainment-seekers would otherwise overlook that become key, benefitting customers greatly.
Where increased competition may be working against customers
Offering low-but-rising fees per month, streaming platforms look to present great value, at least on paper. You get hundreds of films and shows to watch on demand, with most of the major platforms now releasing original content that you can only access as a subscriber to that one streaming service.
Global video streaming revenue is expected to hit $95.35 billion in 2023, so the method is clearly popular. However, the rapid increase in competition of late leaves the general audience rather splintered, and so, less likely to watch and discuss the same shows and movies.
Unfortunately for all of these platforms that essentially sell themselves on quantity, as well as the odd exclusive, quality is taking a hit. You only have to look as far as one of the richest people in the world’s platform, Jeff Bezos’ Prime Video – see his net worth here – which invested $1 billion in what was supposed to be a show based on J.R.R. Tolkien’s The Lord of the Rings. The first season looked low-quality, was abhorrently written, had nothing to do with Tolkien’s works, and only 37 percent of viewers finished its eight episodes. Audiences are split, and there’s little by way of a consensus top-class show or movie to get into and discuss with others.
Looking at the majority of what’s being put out as exclusives at Netflix, Prime Video, and Disney+, even from some of the biggest IPs in entertainment, it’s starting to look like straight-to-streaming is the new direct-to-video. As so much content has to be made to keep people intrigued enough to let a subscription run for another month, the quality is, naturally, lower. It doesn’t have to rely on quality to receive box office returns to keep people on a platform for the month, as many will habitually keep using platforms for series repeats.
Debating healthy competition in gaming
As soon as the acquisition was announced in January 2022, regulatory bodies around the world got to work on examining how the colossal deal would impact competition. After all, the video gaming space – in terms of consoles – is very tight, and gobbling up such a huge third-party producer of software could represent a huge swing in favor of what is currently the bronze medallist among three runners in the industry.
Most recently, China has given the green light to the deal, but there are still major holdouts who maintain concerns for customers. The sticking point is now cloud gaming. A nascent element of the medium, there are fears that Microsoft could corner the market by making the Activision Blizzard library exclusive to their cloud platform alongside its other recent major additions.
Where the UK plants its flag in a structural remedies approach, all others that have approved the deal, such as the EU, are favoring the behavioral remedies approach to this gaming deal. With this, the EU and its fellow green-lighters are trusting in Microsoft saying that it won’t commit to anti-competitive plans or actions. A key piece of this is that the EU sees cloud gaming as a brand new space with little on offer, and Microsoft bringing Activision Blizzard’s vast library to the scene will help to grow the accessible platform for gamers and create competition.
In the different realms of tech entertainment, competition can be both adverse and helpful to customers. For cloud gaming, as it is so underdeveloped right now without true high-end competitors, Microsoft’s move would, in theory, only be good for the new space of entertainment.