> Disney will have to lose money it could otherwise make in order to differentiate its streaming service.
> Such a move cuts against much industrial organizational economic theory. Theorists posit that corporations like Disney tend not to intentionally lose money just to acquire market power, because foregoing revenue is not, apparently, rational. This theory is nonsense. After all, if Disney is willing to tolerate losses just to drive competitors out of business, then vertical foreclosure is deeply problematic, and perhaps illegal.
The reason it's not typically rational is that you have no guarantee of being able to maintain your monopoly once you've cornered the market. As soon as you raise prices to recoup your losses, competitors will come out of the woodwork. This is not the case with media companies though, because they have a government enforced 95 year monopoly on their content.
If Disney were to put Netflix out of business, buy Netflix's content, and then raise their Disney+ service price, I cannot legally setup a competing service to stream Netflix's old content.
TL;DR: The economic theory that says predatory pricing is usually irrational assumes fungible goods, but media is not fungible.
It could be. Imagine a world where movies don't cost millions of dollars to make.
It's a tooling problem more than a budget one.
In fifty years I think we'll be telling the machines what stories we want to experience. But between now and that dreamy future, there are intermediate points along the path that empower individual or small groups of creatives to lift mountains - I think of it much in the same way as languages and tools and libraries make it so we don't have to string together vacuum tubes to solve our problems. Think about the kinds of problems filmmakers face: writing a cohesive narrative, finding and lighting a scene, editing massive amounts of video. It's all just a problem of tooling.
When there is a way that lets you or anyone with an ounce of creativity turn their dreams into polished, watchable content, it will democratize storytelling.
If you have ever seen the prequels, neither can George Lucas....
https://www.news.com.au/finance/business/media/the-secret-we...
https://www.webfilmschool.com/independent-filmmaking-the-7-m...