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Streaming giants Netflix, Disney+ and Amazon Prime face UK reckoning

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·3-min read
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PARIS, FRANCE - NOVEMBER 20: In this photo illustration, the logos of media service providers, Netflix, Amazon Prime Video, Disney + and Hulu are displayed on the screen of an Apple MacBook Pro screen on November 20, 2019 in Paris, France. Netflix offers movies and TV series over the internet and now has 137 million subscribers worldwide. (Photo by Chesnot/Getty Images)
Streaming services rose in popularity during the pandemic, gaining millions of new subscribers as people were forced to stay home. Photo: Chesnot/Getty Images

Streaming giants face a reckoning as the UK government plans to regulate companies in the same way as traditional broadcasters like the BBC and ITV (ITV.L). 

Amazon Prime (AMZN), Disney+ (DIS) and Netflix (NFLX) could all be affected under plans set to be announced next week, the Press Association first reported. 

Britain's media watchdog Ofcom would be allowed to rule on complaints relating to issues including bias and accuracy similar to its oversight of more traditional broadcasters if the proposal is approved.

While Netflix does not currently fall under Ofcom jurisdiction as its based in the Netherlands, it is subject to Dutch regulation even on its English language programmes tailored to the UK version of its site.

Streaming services rose in popularity during the pandemic, gaining millions of new subscribers as people were forced to stay home.

Netflix added a record 15.8 million users as the pandemic forced people around the world to stay home. 

The world's largest streaming provider said in April that slower production of TV shows and movies during the pandemic hurt subscriber growth in the first quarter. 

Netflix's new US subscribers fell to 8.5% during in the three months to March this year, down from 16.2% the same period a year ago. It gained 1.8 million new customers in Europe, 1.36 million in Asia and 360,000 in Latin America in Q1. 

The company expects to add just 1 million new users in the second quarter. Analysts had expected a forecast of nearly 4.8 million.

Read more: What the WarnerMedia-Discovery mergers means for the streaming wars

Amazon bought legendary Hollywood studio MGM in a $8.5bn (£6.2bn) deal in May, in the company's second-largest takeover deal ever. 

The move cements the tech giant's place in the streaming battleground with rivals like Disney+ and Apple TV + (AAPL), which both launched in 2019 in the UK. 

The deal means Amazon now owns rights to a library of over 4,000 film blockbusters including the James Bond franchise, Rocky, and the Pink Panther. MGM has also produced hit TV shows including A Handmaid's Tale, Fargo and Vikings.

Amazon first entered the content market in the late 2000s but has massively expanded its Prime video streaming service in the last five years. It has since become the world's second largest streaming services, with around 175 million customers. 

A spokesperson for Amazon UK declined to comment.

The rise of streaming platforms has put public service broadcasters (PSBs) under more pressure from streaming giants that have large budgets for original productions and a rising numbers of young subscribers.

The UK's culture secretary Oliver Dowden is set to reveal the plans in a broadcasting white paper. Dowden had previously questioned the future of public service broadcaster and has said it is time to "ask really profound questions" over the role PSBs play in the current media landscape.

Yahoo Finance UK has approached all parties involved for comment.

Watch: More companies join streaming wars and battle for viewers

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