For those interested in a deep-dive look inside how dramatically the business of making TV shows has changed over the past several years, last week’s Vulture cover story, “The Business of Too Much TV,” is essential reading. At 10,000+ words, you’ll need to set aside a chunk of time to get through it, but it’s well worth it for a peek behind the curtain of how SVOD has influenced every aspect of TV production.

The biggest driver of change has been the massive increase in the number of scripted TV shows being made - from 36 in 2005 to over 400 in 2015. Cable TV networks were the initial cause of this explosion, but in the past several years it’s been the major SVOD services, Netflix, Amazon and Hulu, which have each turned to originals as a source of differentiation as competition has intensified.

As the article explains, because of SVOD services’ deep pockets and their different business models vs. traditional broadcast and cable networks, many of Hollywood’s rules are being rewritten. The most visible way is through the gargantuan salaries - reportedly $350K-$500K per episode - that top tier movie actors (e.g. Billy Bob Thornton, Drew Barrymore, etc.) are commanding to make the move into TV. While these are the peak, there are many examples provided of lesser-known actors who are seeing huge bumps in their compensation as well.

Exploding actors’ salaries are feeding an increase in production budgets, which means a single episode of a drama can now run $3-4 million. But basic laws of supply and demand are also responsible for skyrocketing budgets. The article points out that 50+ series are currently shooting in locations like Vancouver and Atlanta, stretching everything from crew staffing to equipment rentals to day-to-day necessities like catering. Certain key roles like line producer, who are responsible for all aspects of a show’s production operations, are also in short supply.

Even as the number of productions has soared, the business models for financing them has also significantly changed. The article notes that SVOD services have caused syndication revenues - the lucrative “backend” for studios and showrunners that has fueled the traditional deficit financing of shows - has all but dried up except for in a handful of instances. One omission from the article is the effect of TV networks retaining stacking rights on pushing down SVOD’s appetite for catalog episodes as well. While SVOD tends to pay more upfront, it then limits the long-term value of TV shows for both studios and showrunners. All of this scrambles the picture for where TV shows end up getting made.

If these are the downsides, then the upsides are that there’s more opportunities than ever for writers and diverse voices to be heard. The article provides numerous examples of new writing talent that has broken through, in non-traditional ways. That said, with so many TV shows being made, the quality bar is higher than ever. Material must not only be fresh, but it also needs to be combined with expensive cinematic flourishes to get noticed by audiences. Even after all this work has been put in, there’s concern that the glut of new TV shows has limited the promotional effort put behind any one of them.

The fear expressed by professionals throughout the article is that there’s a bubble in TV show production that’s going to burst at some point, due to ever-shifting business models, unexpected drops in stock prices or something else unforeseen. There’s no doubt the TV industry is now in completely uncharted territory, driven by the bottomless appetites of SVOD services. Viewers are being presented with more choices than ever, and even with the proliferation of viewing devices, there’s ultimately a saturation point.

With so much of the TV industry currently in flux, there’s ample reason to be worried about over-production, especially with the stakes getting higher all the time. But until there are clearly flashing warning signs, I wouldn’t expect production levels to slow down.