AMC on SVoD: “It’s broken”
February 21, 2023
It takes someone with the self-confidence born of being born into one of the founding families of second-generation television to call out that the third-generation simply isn’t working.
James Dolan is the chair of AMC Networks, the content spin-off of Cablevision, one of the founding father companies of the US, then global, cable and pay-TV era. The Dolan family were founders of Cablevision and remain major holders of AMC.
And James Dolan is a man with the confidence to not only say the model his company is now trying to operate within is broken, but he’s also brought his wife (separated but still close) in to mind the shop while they figure out what to do.
In common with other streamers, the company has been making cuts – in the order of 20 per cent both of staff and of production slate. Dolan told investors “the current mechanisms for monetising content are not working… we need to course correct”.
He said further M&A consolidation was possible, but it wasn’t the answer, unless there was better monetisation opportunities for content providers. He said the problem was the switch from wholesale to retail had been misunderstood, with valuation of subscribers still based on pay-TV models when you ‘really had to work’ at cancelling. Now a customer can binge your product for a month or two and then leave with one click.
He noted further consolidation would only have a point when people figured out how to make an acceptable ROI in a high cost business that has stuck itself with low prices and low barriers to exit.