How Amazon Defeated Disney in Streaming: Learning from Rings of Power

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As you read this, understand that Amazon has pivoted away from Disney's DEI strategy that killed Rings of Power. And thus, Amazon overtook Disney in 2023 for hours of streaming watch-time -- a hugely important streaming metric that now puts Amazon in the top three.

1. YouTube
2. Netflix
3. Amazon Prime Video

This is why Disney is being forced to face change.

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Believe it or not, Amazon is among the leaders in conducting extensive research on specific content, both before and after its release. Their approach is heavily driven by analytics, deeply ingrained in their core operations. However, this aspect is often overlooked when it contradicts the perspectives of content gatekeepers within the company.

Despite their strong commitment to diversity, equity, and inclusion (DEI), Amazon possesses viewer data indicating that emphasizing DEI can negatively impact the appeal of their content. Nevertheless, they remain staunch supporters of DEI initiatives, often engaging in grandstanding to showcase their dedication.

Interestingly, Amazon manages their DEI strategies from a global, annual perspective rather than evaluating each show individually. This means that while they prioritize DEI, the ultimate measure of success lies in their overall DEI performance at the end of the year, rather than mandating high DEI scores for every project.

Unlike Disney, which previously required high DEI scores for every project, Amazon takes a more flexible approach. They assess their DEI performance annually, considering factors such as the number of high-scoring DEI projects, the budgets allocated to them, and the extent of their promotional efforts.

This approach allows Amazon to greenlight a few lower-budget projects that may not meet stringent DEI criteria but still contribute to their overall content slate. These projects, although fewer in number and with lower budgets, still manage to attract a substantial audience.

Interestingly, when Amazon evaluates the success of their projects, they analyze various metrics including costs, viewership within the first week, month, year, and beyond. Surprisingly, it's often the non-DEI projects that excel in these metrics due to their broader appeal and lower production costs.

High-profile DEI fantasy shows, with their extravagant budgets, often fall short in these analytics. For instance, their adaptation of "Lord of the Rings" incurred exorbitant costs but failed to garner significant viewership, resulting in dismal performance metrics.

Similarly, analytics for "Wheel of Time" indicated poor performance metrics, resembling those of "Lord of the Rings." Despite its high-profile status, the show failed to meet expectations.

Overall, this insight suggests that Amazon will continue to produce a mix of low DEI productions strategically integrated into their annual output. This approach reflects a conscious effort to balance DEI initiatives with commercial success, highlighting the complexities of content creation in today's landscape.