The change is more about delivery than demand. The Bureau of Labor Statistics’ American Time Use Survey shows Americans still devote about five hours a day to leisure, with more than half of that time spent watching TV.

But instead of flipping through cable channels, more households are paying monthly for on-demand services. Internal BofA payments data shows streaming video and audio represented more than 10% of spending across all income cohorts as of July, and since 2023, it has outpaced other entertainment categories such as live events, theaters, and theme parks. Yet even as consumer appetite grows, the industry faces a new challenge, writes the BofA team led by senior economist David Michael Tinsley: a possible “content recession.” In recent years, providers have dialed back the sheer volume of original shows and films, shifting instead to fewer projects with higher production values.

The content recession could be seen in two ways: either a pullback in the number of shows being commissioned, an emphasis on “quality over quantity” play that may keep subscribers loyal to franchise hits, or a recession in terms of the number of must-watch shows being made as streamers embrace a cheaper, mass production, more linear-TV-like model. As long ago as late 2023, former Amazon Studios chief Roy Price wrote a New York Times opinion piece declaring the era of prestige TV was ending as streaming underwent a fundamental change. BofA analysts caution this could stall growth if viewers feel there isn’t enough fresh material to justify rising monthly bills.

Signs of churn and inequality

BofA’s internal card-spending data shows two-thirds of households are still paying less than $40 a month for streaming. But the bills are creeping up: Roughly one in six households now spends more than $80 per month, and nearly 10% are shelling out over $100.

At the same time, loyalty isn’t a given. Nearly one in five Americans canceled or started a streaming subscription in July. That “churn” means households are nimble, signing up when a hot new series or sporting event arrives, then abandoning platforms when the buzz fades. A content recession materializing could supercharge this dynamic, which could mean the difference between feeling like streaming is an affordable alternative or a runaway expense that rivals old cable bundles. Streaming’s solution to this appears to be reinventing that old bundle in a new form.

Sports, music—and AI—as the next frontier

For now, streamers are betting big on two growth drivers: live sports and music tie-ins. Exclusive sports rights continue to draw subscribers, with CivicScience finding more than a third of fans are willing to sign up for a new service this fall just to watch games. Exclusive rights to football, basketball, and soccer games, plus premium offerings in music and audiobooks, are seen as the next big moneymakers. Women’s sports are seen as an untapped growth area, while music platforms are experimenting with higher-priced tiers and crossover into live events.

The wild card is artificial intelligence. AI could allow streamers to generate content and effects faster and more cheaply, but it also lowers the barriers for new entrants. In the long run, viewers themselves may even use AI tools to create personalized content, potentially disrupting the very model streaming companies are betting on.

Americans aren’t giving up screen time anytime soon. But whether streamers can keep those screens tuned in will depend less on technology than on storytelling. If the content recession deepens, streaming’s dominance could be tested by its own shrinking pipeline.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.