By Gaby Baldovino
On March 7th, 2020, one of America’s most beloved actors, Tom Hanks, announced on social media that he had contracted COVID-19. In the days that followed, the entertainment and media industry spiraled into chaos. The NBA postponed all games, hundreds of film and TV productions were shut down, and many cinemas closed. As Americans were forced into lockdown, the entertainment industry was also forced to accommodate the pandemic. The question that follows is: what will be the long-lasting effects of the pandemic on the industry?
Due to the closure of many movie theatres across the country, Americans have turned to streaming services for entertainment, with an increasing number also cancelling traditional cable and/or satellite television services. In many cases, movies that were scheduled for a spring release, such as Disney’s live-action Mulan, were pushed directly to the online platform. According to a study by Roku, approximately one third of Americans no longer have traditional TV services, like cable and satellite. Moreover, even as lockdown restrictions eased during the summer and some movie theatres opened back up, the number of streaming service subscribers continues to grow.
As a result, it may seem that every entertainment and media company wants a slice of the streaming service pie. Disney+ debuted just as news of COVID-19 broke out in China, and platforms such as HBO Max, NBCUniversal’s Peacock, ViacomCBS’s Paramount+, and Discovery+ have quickly followed suit. These newer platforms compete with established services like Netflix, Amazon Prime, and Hulu.
Professor Shamsai, who teaches Entertainment & Media Industries at NYU Stern, says that the rise in streaming services has been one of the most noteworthy trend during the pandemic. However, the impact of streaming services in the industry is still up in the air: streaming revenues still constitute a relatively small fraction of the TV industry’s total revenue. What’s most important is to consider the economics and profitability of the business models. She says, “Modeling economics and understanding economics is absolutely critical. The verdict is still out on whether it will be a gain, flat impact, or cannibalization and the results will surely vary by offering.”
Not all media companies are suffering as a result of the pandemic. In particular, the gaming industry has seen the largest increase in consumption as compared to other forms of entertainment. Additionally, e-sports have a newfound legitimacy. More people are spending time at home and on their computers. Many have tweaked their working habits to allow for more free time throughout the day which is then spent on gaming.
It isn’t just the film and television industries that are suffering from a lack of in-person interactions. New York City’s famous Broadway shows have been cancelled till May 30, 2021. In an interview with Marketplace, Broadway actress Kathryn Allison said that “if it was not for the pandemic insurance that [Broadway actors] get, I don’t think I’d be able to keep doing what I’m doing now.” Fortunately, online performances, such as the “Ratatouille” musical, have helped raise money to support theater actors. Ratatouille raised almost $2 million for the Actors Fund.
Likewise, the music industry has suffered from a lack of in-person entertainment. Music festivals and concerts were all postponed indefinitely. For example, in a statement posted on her official website, Taylor Swift announced that she would be unable to reschedule her “Lover Fest” world tour, which she had previously only postponed. However, unlike the theater industry, music has already been adapting to a digital and online revenue stream. Many artists, such as Taylor Swift, Justin Bieber, and Megan Thee Stallion, have been able to record new music safely during the pandemic for release on streaming platforms.
Live sports adapted by creating “bubbles” in order to get through game season. Most recently, the NCAA March Madness bubble was created in Indianapolis, IN, allowing basketball teams across the country to participate safely in one of sport’s most exciting events. Players were held under strict health and safety procedures and were isolated from the general public; for instance, they were only allowed to travel between their hotel, practice areas, and game venues. While the March Madness tournament ran rather smoothly, the NFL decided to forgo a bubble last season and 32 teams suffered from COVID outbreaks.
Professor Shamsai is hopeful that in-person entertainment will start to ramp up slowly. She predicts, “I am hoping that the warm summer months will bring back in-person outdoor events. In-person events will eventually return, albeit in a new more COVID-aware incarnation, but I think it will take a [full season] cycle.”
It is clear that the COVID-19 pandemic has had a profound impact on the entertainment industry. However, it should be noted that many of these changes were already in the mix, and the pandemic just expedited the process. Streaming has dominated the music industry for the past several years. Movie theaters have been struggling for years as Netflix, Amazon, and Hulu began to produce their own original content. A significant number of Americans have been canceling traditional television services and replacing it with streaming subscription, long before the pandemic hit the world. The gaming industry has been growing for years. Arguably, the pandemic has not instigated these changes, but simply accelerated them.