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Streaming: Former Hulu CEO predicts major acquisitions by platforms within 2 years

Yahoo Finance entertainment reporter Allie Canal joins the Live show to discuss the timeline for consolidation by competitors within the streaming space.

Video transcript

[AUDIO LOGO]

DAVE BRIGGS: Indeed. All right, stick with us because we want to talk to you about an interesting piece regarding Hulu's founding CEO, who has some predictions for the future of Hollywood and streaming, starting with the prediction that there will only be three major streaming networks left, not counting-- here's an important caveat-- Amazon and Apple. And it's not just the prediction of consolidation, Allie, because we've heard a lot about that, but it's the timeline here.

And this is from Jason Kilar, an interview with the "Wall Street Journal," a piece he has in the "Journal" today. Two years we could be seeing consolidation. It still feels like we are in the early innings of streaming. To have consolidation that quick would be remarkable.

ALEXANDRA CANAL: It would. And if you think about how long everything else has taken, cable-- we were just talking about this in the break-- it's been a very slow death for cable.

DAVE BRIGGS: 20 or 30 years, yeah.

ALEXANDRA CANAL: Exactly. So streaming, a lot of these companies just started at the end of 2019, early 2020. So for two years, to see some M&A, that would be pretty fast, I think. And to me, the big three, that's going to be Netflix, Disney, Warner Brothers Discovery. That who is who I think will survive the streaming wars.

DAVE BRIGGS: Would you just kill the Peacock?

ALEXANDRA CANAL: I kind of did.

DAVE BRIGGS: Did you just kill Paramount and the Peacock?

ALEXANDRA CANAL: I think Paramount and Peacock could combo and merge.

SEANA SMITH: Yeah.

ALEXANDRA CANAL: I think they're the smallest-- the smallest fish in the sea.

SEANA SMITH: But what was also interesting in this piece in terms of what Jason identified potential winners need to do-- and he used Disney as a perfect example of this-- they need to focus on fan experience and bring that into the digital world. So he worked in potential scenarios of digital theme parks. How fun would it be for your kids to claim that their dorm rooms were Hogwarts?

He went on to socially fulfilling video games, epic live digital events that speak to the biggest of fans. We certainly have seen more live events in the digital space, but I haven't personally been to one. But I feel like the feeling out there has been, it's not the same as going to a concert or being there in real life. So I think that could be an interesting part of the business to follow and see who is able to incorporate that the best.

ALEXANDRA CANAL: Yeah, because ultimately streaming is a loser's game. That's why we're seeing a lot of streaming losses across the board. Content, you have to spend tens of billions-- it's billions with a B-- to compete. So if you're a company that doesn't have the money, doesn't have something that's flowing that free cash flow, you're going to be in trouble.

DAVE BRIGGS: Yeah. And kids today, they're all about the experiences. That was a smart observation by Kilar, who says that this real scale is 300 million subs at $15 a month. That is a monster to accomplish. Allie Canal, thank you so much.