The firms blame temporary headwinds: a continuing covid hangover, content delays and, in the case of Apple TV+, the phasing out of free trials. But some analysts are concluding that the ceiling for subscriptions is lower than they had thought. Morgan Stanley, an investment bank, now thinks Netflix will end 2024 with 260m global members, down from its earlier estimate of 300m. And though streamers see the potential to raise prices in rich-world markets, that will be harder in the faster-growing poor ones. In India, Netflix recently slashed the price of its basic plan from $6.60 to $2.60 a month. Morgan Stanley now expects Netflix’s total revenue to grow by about 10% a year in the medium term, not the 15% or more it had previously predicted.

As revenue growth slows, costs swell. Media firms will spend more than $230bn on video content this year, nearly double the figure a decade ago, forecasts Ampere Analysis, a research firm. Netflix’s weak results came despite what it billed as its “strongest content slate ever”, including “Squid Game”, its most popular series, and “Red Notice”, its most successful film. Disney+ is doing far better than the company ever dreamed—but it is costing more, too. Three years ago Disney said it would spend about $2bn on streaming content in 2024. Mr Chapek recently said the figure would be more than $9bn.

Spending is going up partly because the costs of filming have risen. The final season of WarnerMedia’s “Game of Thrones”, in 2019, cost around $15m per episode, which then seemed steep. Amazon’s serialised “Lord of the Rings”, due in September, reportedly cost about four times as much. And audiences have become more demanding. Most people used to cancel their cable-TV subscription only when they moved house, says Doug Shapiro, a former chief strategy officer at Turner Broadcasting System, a television company. Now, he says, they are “becoming accustomed to churning on or off over the quality of content”, signing up to devour the latest hit and then cancelling their membership. Apple TV+, which has the most serious retention problem, loses a tenth of its customers every month, according to Antenna, a data firm, meaning that every year it churns through the equivalent of more than 100% of its members (see chart 2).

The combination of rising costs and slowing revenue growth “calls into question the end-state economics of these businesses”, argues MoffettNathanson, a firm of analysts. Netflix, the most successful of the bunch, expects its operating margin to shrink in 2022, for the first time in at least six years, to 19%; it has attributed its compressed margins to higher spending on programming. MoffettNathanson adds that these figures flatter the firm’s performance. Like other streamers, Netflix amortises the cost of content over several years, when in reality most of its shows are binged in a matter of weeks. (The company insists that its amortisation schedule is based on viewing patterns.)

Streaming’s pinched economics are especially galling for old media firms like Disney, which are used to the far more profitable cable-TV business. Last year Disney reported an operating margin of 30% for its linear TV networks, a typical figure for the industry. The average American cable bill is nearly $100 a month—and viewers are usually subjected to advertising on top of that. Media firms are accelerating the decline of this profitable business by shifting their best content from cable to their streaming services. They are also forgoing box-office revenue by sending movies straight to streaming (though covid-related cinema closures have often forced their hand). Animators at Disney’s Pixar studio are said to be miffed that “Turning Red” is not getting an outing at the cinema in most countries.

There is little choice but to stick with the strategy. Cable is not coming back; streaming is expected to account for half of TV viewing in America by 2024. The focus is increasingly turning to how to make the new business more profitable. Streamers increasingly drip-feed new episodes rather than dropping entire series. Bundling is becoming more common: Disney sells Disney+ along with ESPN+, its sports streamer, and Hulu, a general entertainment service that it jointly owns with Comcast, a cable giant. Apple and Amazon both package TV with other services. WarnerMedia and Discovery are set to merge this year. There may be more to come. “If Netflix is decelerating more rapidly than expected, the great streaming rebundling may need to begin sooner rather than later,” writes Benjamin Swinburne of Morgan Stanley.

The hope at the bigger media firms is that the streaming wars will eventually claim some casualties, leaving the survivors free to raise their prices and dial down spending on content. Peacock, Comcast’s streamer, is trailing. Viacomcbs, which owns Paramount+, is the subject of endless takeover rumours. But even their exit from the industry would leave some determined competitors. Warner-Discovery is betting its future on streaming. Apple and Amazon are getting better at making hits, and have enough money to run at a loss for as long as they like. Disney and Netflix are not going anywhere. It looks like being a long war, and short on spoils.