Please stay tuned for important disclosure information at the conclusion of this episode.

Welcome to Investing Insights. I'm your host, Ivanna Hampton. Adding subscribers at all costs no longer

satisfies many investors. Wall Street wants streamers to produce profits.

Companies are cutting costs, bundling services,

and competing for live sports to generate more revenue.

Morningstar's media and telecommunications team

has taken an in-depth look at the streaming industry.

Matthew Dogan is a senior equity analyst for Morningstar

Research Services. Welcome to the podcast, Matt. Thanks, Ivana. So Netflix dominance extends

beyond streaming. Your team's research highlighted that Netflix likely now reaches more U.S.

homes than traditional TV. Matt, how do we get here?

Well, it seems like it happens slowly and then all at once. There were two sides to this.

Netflix coming up from what had been, of course, at the beginning of small subscriber base and the

pay TV subscribers or services losing subscribers at a rapid clip. So from the Netflix

point of view, it started out probably more of like as a niche product. It didn't have

necessarily premiere content. It wasn't huge, but it had some features that were attractive

for consumers. It was a low monthly price.

There was a lot of different content.

It could be consumed anywhere.

So that was able to kind of build, and we know what happened in Netflix.

It became huge.

It started getting premier type of content,

...