It’s no longer just David Zaslav, CFO Gunnar Wiedenfels, and a room full of ruthless Warner Bros. Discovery accountants swinging their Excel sheets like guillotines. Stream your bucket-list series and movies (note: 2008’s “The Bucket List” is only available on PVOD) while you still can — content removal is the new power move.
Last month, Paramount+ scrubbed shows “Inside Amy Schumer,” “From Cradle to Stage,” “Tell Me a Story,” “Ghislaine: Partner in Crime,” movies “Fantasy Football” and “Snow Day,” and a crop of Nickelodeon series from its archives, a source confirmed to IndieWire. The library purge followed the cancellation of “Grease: Rise of the Pink Ladies,” “Star Trek: Prodigy,” “The Game” and “Queen of the Universe,” all of which were also removed from the service.
In the current phase of the streaming wars, outspending is so tacky. Now it’s all about out-saving each other. It’s a practice in less is more, and the math can actually bear that out.
Credit goes to Warner Bros. Discovery as the trendsetter: The then-newly merged company made its bones last August with its singular farewell to “Batgirl,” a completed straight-to-streaming HBO Max film (with a theatrical budget) that went directly to Trash before anyone could see it. In return, the publicly traded company saw some relief from its $56 billion in debt. (Now WBD has only $47 billion or so left to go.)
By the end of 2022, dozens and dozens of existing HBO and HBO Max shows and movies got the Thanos snap. In no time, the idea went from unthinkable to standard practice. We spoke to half-dozen or so streaming insiders for this story and all agreed: This is the new normal.
About a month ago, Disney did its best WBD impression and dropped 76 titles from streamers Disney+ and Hulu. The following week, a company SEC filing suggested that content-dump wouldn’t be the last. Case in point: Last week, Hulu removed two one-and-done ABC series with “Alaska Daily” and “The Company You Keep.” (They’re available on PVOD.) Waving goodbye to single-season series and one-off specials will become regular practice for ABC content on Hulu, a person with knowledge of the plans told IndieWire.
Streamers have always rotated licensed content on and off platform based on when existing agreements ended and new ones began. This is different: These properties are owned by the streamer and have no expiration dates. However, streaming platforms no longer view themselves as warehouses with endless storage space. It’s not that “everything must go,” but not everything can — or should — stay.
Removing content accomplishes a few things. First, if a platform pays rights fees to a producer or studio, it can remove the fees from the balance sheet. And since every piece of content has an amortization schedule, removal accelerates it. It’s like totaling a car that still has years to pay off.
There’s also a psychological effect: It can confer a sense of exclusivity and allow streamers to brag about curation (as they’re wont to do). Several people told us that with new programming always incoming, so is data about what keep users engaged; you don’t want the good stuff diluted by the bad.
In certain cases, a content-impairment charge — defined as the drastic reduction or loss in the recoverable value of an asset — can be used as a tax write-off to offset gains. That’s best exploited amid a restructure, like when WarnerMedia combined with Discovery last April.
The Paramount purge will create a similar benefit thanks to merging Showtime with Paramount+, a person with knowledge of that new setup told IndieWire. Keep an eye on what Disney and Hulu do late this year or early next; this opportunity is rare and it comes with caveats.
WBD has licensed some shows it removed, creating another revenue stream. Some HBO series — “Insecure,” “Six Feet Under,” “True Blood” (internationally only; it’s currently available in the U.S. on Hulu), “Ballers,” “Band of Brothers,” and “The Pacific” — are either now on or are headed to Netflix, a source with knowledge of the deal told IndieWire.
“Westworld” is a cornerstone of a WBD-branded FAST (free, ad-supported streaming television) channel packaged for Tubi and Roku. Technically, the series is a write down; WBD had to deduct the licensing fee. (It was a very small fee, we’re told.) However, “Westworld” can never live on Warner Bros. Discovery platforms again without some fancy accounting reversals. Streaming may be the wild west, but CPAs are anything but wild — and nobody wants the audits.
