Perspectives - Embracing Change (Spring 2024)

Section 1: Conquering screens in the race to profitability

A look at broadcasters’ and streamers’ shifting strategies

By: Nicole Matiation
Senior Lead AV Production, Nordicity

The era of free-flowing investment in production to secure subscribers appears to be ending as streamers shift to a profitability model. Does the slowdown in programming spending described by trade press as “the end of peak TV” mean a slowdown for the whole ecosystem? Does the crowning of Netflix as the winner of the “streaming wars” mean it will now reign unchallenged? Let’s look at the past few years before diving into the dynamics reshaping our industry.

During “peak TV,” a wide array of content with high production value flooded screens everywhere. Audiences flocked to streaming services, spent less time watching linear television, and began dropping cable subscriptions (chart 1.1). This trend only accelerated during the pandemic.

P2 EN Chart 1 1

Netflix has been the consistent front-runner for the number of subscriptions since 2019.

At the outset of the pandemic in 2020, it saw a rise in subscriptions, which eventually levelled off as subscribers explored other services. Their subscriptions peaked again in 2021, then dropped sharply as the pandemic waned. In 2022 and 2023, the streamer returned to subscription growth.

Throughout this period, other streaming services followed a similar growth pattern; the “streaming wars” were declared, at least in some trade press headlines. However, none of them could claim as high a level of subscriptions as Netflix.

Competing with streamers for viewers and as their cable and pay-TV revenue dropped, traditional broadcasters started struggling to retain advertising dollars.

Before the pandemic, total agency ad spend on digital in Canada was growing, and eventually surpassed linear TV in the second quarter of 2018. This period also saw a sharp drop in total agency advertising spend on linear TV. From then on, agency advertising spend on digital platforms and on linear TV continued to evolve in parallel, with digital representing the larger portion.

When COVID-19 hit and audiences moved en masse to streaming services, an even larger portion of ad budgets followed (chart 1.2) 1. Strikingly, the total advertising spend on linear TV bounced back and stabilized at near pre-pandemic levels after experiencing a sharp drop at the beginning of the pandemic 2. The total agency spend on digital advertising followed a similar pattern, although always showing a steady increase.

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Ad revenue, part of the drive to profitability

Simultaneously to these shifts, advertising-based video on demand (AVOD) and Subscription-VOD options currently offered by streamers and free ad-supported streaming TV (FAST) channels experience significant growth. This represents further disruption to the broadcasting system.

Producers and content creators negotiate with buyers in two systems: broadcast and streaming, both facing significant challenges. While the past few years were marked by high global demand for audiovisual productions, recent modelling points to a levelling off of global spending on audiovisual content (chart 1.3) 3.

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With increased competition for audiences, inflation, and high interest rates, shareholders of streaming giants are applying pressure to see a financial return on their investments beyond subscription figures. Audience numbers remain critical to the ongoing success of streamers, but their focus has shifted to a profitability model 4 and the monetization of that audience.

The Wall Street Journal’s data shows trends in the value and volume of shares for the largest streamers (chart 1.4). While market interest just prior to and during the pandemic appeared to mirror subscription numbers, it seems to respond to efforts to sustain profitability since 2022.

P2 EN Chart 1 4

Early signals of this included Netflix clamping down on shared subscriptions and introducing a less expensive, ad-supported tier in 2022 (which became available in Canada in February, 2023) 5. Chart 1.5 shows how many users were attached to Canadians’ Netflix accounts over the course of 2023. Although there is a significant increase in accounts with only one user, it cannot be confirmed if these changes are solely due to Netflix’s strategy. Nevertheless, Netflix saw growth in paid subscriptions as a result. In fact, they have significantly higher direct-to-consumer earnings than their competitors (chart 1.6).

P2 EN Chart 1 5

P2 EN Chart 1 6

Prime Video also made its basic subscription ad-supported and now requires Canadians to upgrade to a higher-cost tier to go ad-free. A new Paramount+ “basic” plan also launched in Canada on April 1st, 2024 6.

Other streamers are likely to follow, banking on subscriber preference for a cheaper subscription with ads—which is a much more lucrative model.

Back to the future?

Other ad-supported digital distribution models are already present in the marketplace. YouTube streaming services are based on an ad-supported model, as are CBC Gem and Radio-Canada’s ICI, which launched in 2018 and 2010 respectively. They offer the option of free content with ads, or an ad-free subscription at half the price of an international streaming service 7.

The number of FAST channels, which provide audiences with programming options often thematic in nature, also grew over the past couple of years 8. Some FAST channels are investing modestly in original content, but most focus on acquiring back-catalogue titles. These services provide another choice to consumers, but their capacity to pull audiences away from the name-brand streamers or linear television remains to be tested.

Ad sales are a new revenue source for SVOD streamers offering an economical price point to secure subscriptions from inflation-strapped audiences with less discretionary income. To further slow churn and offer more options to subscribers, streamers may offer lower monthly price points for longer-term subscriptions 9.

But for now, bundling services is a key tactic to attract and retain audiences 10. For instance, Disney launched its Disney+/Hulu bundle in 2023; Apple TV+ and Paramount+ were reported to be in discussions in December 2023; and the Netflix/Disney+/Prime Video bundle launched in Canada in January 2024 11. And most recently, Disney and Warner Bros. Discovery announced on May 8th, 2024, that they were teaming up to offer a new bundle comprising Disney+, Hulu and Max 12. In the European market, pay-TV channels and streamers have struck a number of deals including Charter’s Disney+ ad-supported tier in its pay-TV bundle, and Telecom Italia’s bundle with Prime Video 13.

Bundling is a familiar space for broadcasters. Corus’ STACKTV launched on Prime Video Channels in 2019 with 12 linear networks 14. Today it offers 16 channels through Prime Video Channels, Rogers, Bell, and Fubo.

Streamers are also offering more “appointment viewing” of live-streamed events and scheduled episode releases 15 to sustain audience attention. This strategy includes investing in and promoting tentpole titles, such as the Netflix release of Sex and the City in April 2024, and other hit series like Six Feet Under and True Blood to follow later this year 16.

With streamers offering ad-supported subscriptions, bundling, and “appointment viewing” of premium content, along with FAST channels playing out in the background, the digital platform ecosystem is starting to look a lot like conventional television.

Restructuring across broadcasters, streamers, and tech giants signals a period of restrained investment

In addition to boosting revenue through advertising, streamers and broadcasters are actively cutting costs and reducing risk. Content commissioners appear more likely to cancel shows and order shorter seasons 17. Where the streamers once took a walled garden approach—controlling production from development through distribution—there is an emerging openness to shared licencing agreements and windowing 18.

Recent labour strikes in the United States have also put pressure on streamers, resulting in a six-month production stoppage that is only slowly resuming 19. The strikes resulted in new wage and residual deals that will add to the rising cost of production, and potentially influence other labour negotiations.

Inflation and the shift towards profitability have also contributed to layoffs and restructuring throughout the audiovisual sector 20. Netflix cut more than 300 jobs in 2022 following a drop in subscriptions 21; Amazon made cuts to its gaming division and Twitch in 2023 22; Disney undertook a company-wide restructuring to focus on creative decision-making roles 23; broadcasters including Bell Media 24 and Québecor announced massive layoffs 25; along with tech companies like Microsoft, Meta, and Qualcomm 26.

Consolidation of companies may also occur as the market drives towards profitability 27. Warner Bros. Discovery’s merger talks with Paramount shook the ecosystem at the end of 2023, (although they halted discussions after several months)28 and telecommunications companies adept at consolidation and bundling are anticipated to enter the digital distribution space as well 29. Telus, originally focused on the wireless market, now offers a bundled streaming service 30. Even companies in unrelated sectors are also bundling streaming subscriptions in an effort to attract and secure loyal clients. French supermarket giant Carrefour, for example, now offers a store discount and Netflix bundle 31.

The race to “win” the living room

While tech giants Apple and Amazon are active in the streaming space and have pockets deep enough to buy up competitors, it’s YouTube that has a similar audience share to Netflix, according to Global Web Index (GWI, Q4 2023) across all age groups in Canada.

Seven years after launch, YouTube TV has more than eight million subscribers, placing it among the top American pay-TV companies, while other players such as Comcast, Charter, and Direct TV lose market share 32. YouTube also entered the aggregator business, offering a bundle of streaming services under the new YouTube Primetime Channels brand, currently available in the United States, Germany, and the United Kingdom 33. It is offered alongside YouTube TV as a stand-alone paid option.

YouTube is also moving into the sport sector with the NFL Sunday Ticket, in a seven-year, US$14B deal available to non-YouTube TV subscribers. In a recent Deadline interview, CEO Neal Mohan confirmed the company’s strategy to expand and “optimize [content] for the living room” 34 (find out more about the expansion strategies of user-generated content platforms in Perspectives issue 1).

But YouTube is far from alone in the race for sports rights. Prime Video struck a multi-year deal with Direct TV to take over Thursday Night Football live 35. Warner Bros. Discovery’s Max and NBCUniversal’s Peacock are also actively providing live sport access 36. And Netflix is moving quickly to build out its sport offering, which includes The Netflix Cup, a live golf event in September, 2024, featuring athletes from its Formula 1 docu-series and the PGA tour 37. Starting in 2025, Netflix will also carry WWE Raw in a US$5B, 10-year deal 38.

Netflix’s objective to “win the living room” includes animation content for younger and older audiences alike 39: Gabby’s Dollhouse and successful franchise titles Dr. Seuss and Hot Wheels; investments in anime; and partnerships with video game studios like Ubisoft, Capcom, and Riot in addition to publishers like Sega. Video game adaptations such as Castlevania, Arcane, Cyberpunk: Edgerunners and Sonic Prime have been successful, as Netflix continues building a game business that includes choose-your-own-adventure offerings.

Content is still king, but market imperatives and evolving technology are reshaping business models. It is indeed back to the future as streamers and tech giants incorporate both advertising and subscription revenue streams into their direct-to-consumer business model. Canadian broadcasters, having evolved through a regulated system based on a one-to-many business model have struggled to adapt. Through the CRTC’s ongoing work following the passage of the Online Streaming Act, which the results are hotly anticipated by all industry stakeholders, a modern approach that recognizes all players that distribute audiovisual content (whether online or via broadcast) will provide a framework for investment in Canadian content. Regardless of the regulatory framework that emerges, in today’s digital direct-to-consumer marketplace, audience behaviour plays an ever more critical role in successful business models – for producers as well as streamers, broadcasters and tech giants.


  1. The Digital Media Universe: Measuring the Revenues, the Audiences, and the Future Prospects, a report prepared by Nordicity for Digital Media at the Crossroads (DM@X), January 2024.  Digital Media Universe 2024 ( Market Reports – Current trends – Broadcasting | CRTC
  2. Future of TV Advertising Canada 2022 – Standard Media Index.
  3. The Digital Media Universe: Measuring the Revenues, the Audiences, and the Future Prospects, a report prepared by Nordicity for Digital Media at the Crossroads (DM@X), January 2024 Digital Media Universe 2024 (
  4. “Peak TV Tally: 599 Original Scripted Series Aired in 2022 — A New Record, But FX Says We’ve Hit the Limit” (Variety, January 12, 2023). Deloitte Streaming services profitability | Deloitte Insights
  5. Netflix rolls out new fees for password sharing in Canada | CBC News
  6. “Paramount+ Sets Launch Details for Ad Tier in Canada, Australia, Premium Plan in France” (The Hollywood Reporter, March 19, 2024).
  8. Is free, ad-supported television the answer to changing viewing habits? | CBC News, Number of FAST channels worldwide by country 2023 | Statista
  9. Streaming services profitability | Deloitte Insights
  10. “Verizon To Offer a Netflix & Max with Ads Streaming Bundle For $10 A Month” (Deadline, December 4, 2023)
  11. “Disney+ Adds Hulu Content for Bundle Subscribers in Beta Launch — but Not Everything From Hulu Is Available” (Variety, December 6, 2023), “Apple-Paramount Bundle Would Be Another Hail Mary Streaming Play” (Variety VIP+, December 5, 2023), “Streaming Bundle With Netflix, Disney+, Prime Video Hits Canada” (The Hollywood Reporter, January 18, 2024)
  12. “Disney and Warner Bros. Discovery to Launch Disney+, Hulu, Max Streaming Bundle” (Variety, May 8, 2024)
  13. “Charter adds Disney+ ad tier to pay TV bundle for free in landmark deal” (Digital TV Europe, January 5, 2024), “Telecom Italia to bundle Amazon Prime in TV packages” (Digital TV Europe, December 12, 2023)
  14. Corus launches STACKTV, a multi-channel TV package for Canadian Amazon Prime members – National |
  15. “The Binge Model is Losing Out to Week-to-Week Streaming Releases for Sustaining Longer Interest | Charts” (The Wrap, October 27, 2023), Streaming services profitability | Deloitte Insights
  16. “‘Sex and the City’ Lands Premiere Date on Netflix” (The Hollywood Reporter, March 2, 2024).
  17. “Why streaming services are dumping shows left and right” (VOX, June 29, 2023), “Seven-Year Cancellation Itch: Why ‘Good Doctor’, ‘Station 19’ & Other Broadcast Series Are Ending After 7 Seasons” (Deadline, January 15, 2024)
  18. “Licensed Content Is the New Currency in Hollywood” (Variety VIP+, December 14, 2023)
  19. Global Film Production Remains Cautious After U.S. Strikes (
  20. Media Companies Have Slashed Over 20,000 Jobs In 2023 (
  1. Netflix cuts 300 more jobs after subscriptions fall (
  2. Amazon will cut hundreds of jobs, including at game streaming firm Twitch | CNN Business
  3. Disney to lay off 7,000 workers in major cost-cutting restructure | CBC News
  4. Bell Media planning cuts to CTV, BNN Bloomberg following BCE layoffs, sale of 45 radio stations | CBC News
  5. 240 emplois supprimés à Groupe TVA et chez Québecor | Radio-Canada
  6. ”A comprehensive list of 2023 & 2024 tech layoffs“ (TechCrunch, April 5, 2024).,last%20year’s%20first%20quarter%20cutbacks.
  7. “Warner Bros. Is in Talks to Merge with Paramount Global” (Bloomberg, December 20, 2023), “Canal+ Group Gets Anti-Trust Approval to Acquire French Pay TV Group OCS and Orange Studio, Under Certain Conditions” (Variety, January 12, 2024),
  8. ”Warner Bros. Discovery halts merger talks with Paramount Global, sources say“ (CNBC, February 27, 2024).
  9. Why Telecom Will Be Key to Bundling’s Next Phase (
  10. “Stream+” (TELUS)
  11. “France’s Carrefour launches Netflix-plus-store discounts package” (Digital TV Europe, January 16, 2024)
  12. YouTube TV Hits 8 Million Subscribers (
  13. YouTube launches Primetime Channels in Germany – Digital TV Europe, YouTube Primetime Channels launches in Germany (
  14. ”YouTube TV Hits 8 Million Subscribers; Viewing Of YouTube Content Via TV Screens Now Averages 1B Hours A Day” (Deadline, February 6, 2024).
  15. Amazon signs deal with DirecTV to air ‘Thursday Night Football’ games in bars (
  16. Max and Warner Bros. Discovery to offer NBA, MLB postseason and other live sports in October – The Athletic
  17. Netflix leans more into sports programming (
  18. Netflix slams into live events with $6.7B wrestling takeover of WWE’s Raw | CBC News
  19. Behind Netflix’s Strategy to Win the Living Room With Animated TV in 2023 (