Streaming’s Golden Age Is Suddenly Dimming

American television viewers have become accustomed to it: Dozens of premieres every month, hundreds of shows every year, a guarantee from Hollywood that there’s always going to be something new to watch.

The so-called Peak TV era has included unexpected gems (“The White Lotus”), huge hits (“Stranger Things”), meat-and-potatoes fare (nine different series from the “Law & Order” producer Dick Wolf) and the utterly bewildering (five full seasons of the “Full House” reboot, “Fuller House,” on Netflix).

But a new reality has become increasingly clear over the past few months in Hollywood: Peak TV has peaked.

The never-ending supply of new programming that helped define the streaming era — spawning shows at a breakneck pace but also overwhelming viewers with too many choices — appears to finally be slowing.

The number of adult scripted series ordered by TV networks and streaming companies aimed for U.S. audiences fell by 24 percent in the second half of this year, compared with the same period last year, according to Ampere Analysis, a research firm. Compared with 2019, it is a 40 percent drop.

The peak TV era has included the hit Netflix hit series “Stranger Things.”Credit…Netflix

“The second half of the year has really gone off a bit of a cliff,” said Fred Black, a research manager at Ampere.

It may take some time for that to become apparent to viewers — if it becomes apparent at all, given the glut. It is usually months and sometimes more than a year for a TV show to premiere after a network orders it.

The drop is a result of broader reckoning inside the entertainment industry. For years, television executives tossed off billions of dollars on TV series to help build out their streaming services and chase subscribers. The spending has been a boon to high-profile writers and producers, who captured eight- and nine-figure deals, as well as for the actors, directors and behind-the-scenes workers who kept the engine going.

But Wall Street soured on the buy-at-any-cost strategy starting in the spring, when Netflix, the streaming powerhouse, announced that it had lost subscribers for the first time in a decade. Netflix’s stock nose-dived, and other entertainment companies soon watched their share prices fall, too. Hollywood companies quickly shifted, putting a new emphasis on higher profits instead of raw subscriber counts.

The Race to Rule Streaming TV

  • A Surprising Shake-Up: After a disastrous earnings announcement, which included Disney reporting $1.5 billion in losses at its streaming division, the company ousted Bob Chapek as chief executive and announced that Robert A. Iger would return.
  • Sunday Ticket Talks: Google, Apple, Amazon and ESPN are all interested in landing rights to stream N.F.L. games. Now negotiations are going into overtime.
  • Theatrical Releases: Netflix agreed to some exclusive theatrical distribution for two new films — “Glass Onion” and “Matilda the Musical” — but it’s not clear exhibitors will get much more.
  • Netflix’s Rebound: The streaming giant said that it added more than 2.4 million subscribers in the third quarter, snapping a streak of customer losses that spurred unease among investors.

Then, in recent months, entertainment companies became increasingly anxious about a slowing economy, the cord-cutting movement and a troublesome advertising market. Since the summer, scores of executives have abruptly been dismissed, strict cost-cutting measures have been adopted and layoffs have taken hold throughout the industry.

The recent decline in show orders tracks that path. The number of series ordered in the first six months of the year showed no signs of letting up — it was shaping up to be just another year of buying in the Peak TV era. In fact, 325 series had been ordered, more than each of the previous three years, according to the research.

That market dried up — and it dried up in a hurry.

Jay Carson, the creator of the Apple TV+ series, “The Morning Show,” and who currently has several projects in development at outlets like FX and Peacock, said that his talent representatives had warned him in recent months that it was a “blood bath of a market.”

“They will love and believe in the project and know the material and package are strong, but they’ll tell you that right now if you take it out, you’ll end up like the guys in the opening scene of ‘Saving Private Ryan,’” he said.

Hollywood insiders felt a cutback on series orders was inevitable, particularly when many executives were ignoring profit margins and giving full series orders without so much as seeing a script.

Jennifer Aniston, one of the stars of the Apple TV+ series, “The Morning Show.” Jay Carson, the creator of the series, said that it was a “blood bath of a market” now for new series.Credit…Apple TV+, via Associated Press

“It’s part cost-cutting and stock price chaos, and part correction for the buying frenzy over the past five years where series were literally ordered over the phone without any proof of concept,” said Robert Greenblatt, the former chairman of NBC Entertainment and WarnerMedia who is now a producer.

For the year, the deepest declines in the number of orders for scripted adult series in the United States were at Netflix, Warner Bros. Discovery (which includes HBO and the Turner networks), and Paramount (which includes CBS, Paramount+ and Showtime). The series orders for U.S. audiences have fallen 22 to 27 percent at those three companies, according to Ampere. In the second half of the year, the drop-off in orders from the three companies was even steeper.

After Netflix lost subscribers earlier this year, it vowed to slow its spending on content. Netflix also cut hundreds of jobs and introduced a cheaper advertising tier, overturning the company’s longtime pledge to never allow commercials on the service.

Warner Bros. Discovery, a company that was formed in April, faces a debt of roughly $50 billion, and has been in severe cost-cutting mode. There have been rounds of layoffs companywide, including at HBO and HBO Max, as well as sudden cancellations. The once-popular series “Westworld” was canceled last month — a move that surprised Hollywood — and the lesser-known, raunchy dating series “FBoy Island” was cut a few weeks ago.

And Warner Bros. Discovery-owned basic cable networks like TBS and TNT, which just five years ago had greatly expanded their original programming efforts, have scaled back those ambitions since the merger.

There are a few outliers to this year’s trend: Apple TV+ and Amazon have increased the number of adult scripted series they have purchased this year. So has Disney, according to Ampere’s research. (For the second half of the year, however, Disney’s buying has declined compared with the same period last year.)

Mr. Black said Amazon and Apple, which get a vast majority of their revenue from their tech products and services, are “obviously not as beholden to the same budget limitations as pure entertainment companies — they have deeper pockets and can weather this storm,” he said.

The once-popular HBO series “Westworld” was recently canceled.Credit…John P. Johnson/HBO

Although orders for scripted series in the United States are falling, orders for international and unscripted series remain steady, Mr. Black said.

The dip in the United States didn’t come as a complete surprise. John Landgraf, the FX chief executive who coined the term “Peak TV” in 2015, said in August that this year was on pace to have the highest number of scripted TV series to air or stream.

But he also said that he believed this year would be the last one to set a record because fewer networks were investing in scripted content, and because all of the major media companies had already started their streaming services.

“You’re at the point now where you’re not really adding new suppliers, but you are, to some extent, subtracting some suppliers,” he said then.

Indeed, in addition to TBS and TNT, digital giants like Facebook and YouTube, which were investing in original series just a few years ago, have mostly moved on. The CW, which was recently acquired by Nexstar, is looking for lower-cost programming. And there are numerous basic cable networks that in recent years have pulled back from original scripted programming ambitions.

Some writers have found the market conditions so difficult that they are giving up on the idea of turning a project into a TV series — and looking to movies instead.

“In a stark reverse of what happened for 20-plus years, writers are now taking TV projects and converting them to features because they’ll be easier to get done,” said Mr. Carson, the TV writer. “The truth is, a lot of projects for the last 20 years that should have been features were stretched to be TV because that’s just what you did.”

Agents, meanwhile, are recommending a strategy rarely employed in recent years: patience.

“It’s a terrible time to sell right now,” said Rick Rosen, a prominent television agent at WME. “I’m advising my clients, if it’s a really good show and the outlets we want to sell it to are delaying or in not-buying mode, my advice is to wait.”

Within Hollywood executive circles, there is debate about whether buying will pick up in the new year. One complication is the potential for a strike next year by members of the television writers union.

But there is a feeling that when the business stabilizes, the declines will ease, even if the buying doesn’t again reach the highest peaks of the Peak TV era.

And in the end, there could be a silver lining for viewers: Scaling back the volume could make for a higher percentage of quality shows.

“These companies pulling back — thinking longer and harder about each project — is actually good for the business,” said Mr. Greenblatt, the former television executive turned producer. “It will hopefully lead to less waste and more shows worth watching.”

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