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Netflix is not a tech company (2019)

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Re: Netflix is not a tech company (2019)

#81

Post by comeonseriously »

chipotle_coyote wrote: post #63
Areading314 wrote: post #3

We should stop thinking in terms of "tech companies" and think of them in terms of "companies that use tech with a high degree of success". Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. Also, with the right incentives and management it is possible, although hard, for legacy companies to start using tech better to compete.

> Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. "X makes money, therefore they are not a tech company" seems rather oversimplified in the same way "X is a tech company" is oversimplified. Actually, it seems oversimplified to the point of maybe not being so useful. I think the way most people would define "tech company," if they were pressed…

> but if I say "Dell is a technology company and Cadbury is not," I don't think people will really object to that unless they're trying to be pedantically clever about it

Such as if you were to ask people, "which is the tech company, Apple or Ford?", most would choose Apple, choosing to call Ford, instead, a "car company".

Re: Netflix is not a tech company (2019)

#82

Post by randomdata »

Areading314 wrote: post #3

We should stop thinking in terms of "tech companies" and think of them in terms of "companies that use tech with a high degree of success". Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. Also, with the right incentives and management it is possible, although hard, for legacy companies to start using tech better to compete.

I imagine all successful companies use some kind of tech to a high degree of success. That tech may not necessarily be computer-based.

Re: Netflix is not a tech company (2019)

#83

Post by munk-a »

chipotle_coyote wrote: post #63
Areading314 wrote: post #3

We should stop thinking in terms of "tech companies" and think of them in terms of "companies that use tech with a high degree of success". Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. Also, with the right incentives and management it is possible, although hard, for legacy companies to start using tech better to compete.

> Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. "X makes money, therefore they are not a tech company" seems rather oversimplified in the same way "X is a tech company" is oversimplified. Actually, it seems oversimplified to the point of maybe not being so useful. I think the way most people would define "tech company," if they were pressed…

Is Dell really a tech company though? Does selling computing hardware really count as tech these days since Apple would definitely end up being a tech company under that definition - even with all the other revenue streams it has I think being one of the largest manufacturers of computing hardware would automatically qualify them.

I personally consider "tech companies" to be companies with tech I find interesting to think about - Netflix definitely qualifies under that header, Apple does too owing to producing a huge operating system, Amazon not only has AWS services on offer but they also run a storefront of a staggering scale and were pioneers in how storefronts like that were discovered... Dell - Dell might get grandfathered in as a tech company based on how they were earlyish into the market of web-based computer sales (ala "Dude you're getting a Dell" days) but now a days I assume their tech stack is a pretty ornery customized CMS like thing with a relatively simple order processing system behind it.

Re: Netflix is not a tech company (2019)

#84

Post by liuliu »

eldavido wrote: post #76

I used to read a lot of writing like this and still do (tech strategy newsletters--Stratechery, Benedict Evans, etc) The hazard of reading stuff like this is that it makes the world seem much more orderly and predictable than it is. Case in point: Zoom. "Videoconferencing is a commodity". "Distribution is all that matters". And all of a sudden, someone does this "commodity" a lot better, without the pre-existing netw…

I use Apple TV. Netflix does have better user experience (in terms of playing videos) than Prime Video, HBO Max, Hulu for me.

It plays faster, seeks faster, properly does Dolby Vision / HDR when the content has it and has different language subtitles. It animates properly from one screen to another (in stark contrast to Prime Video).

The content exploration and navigation is something to be desired, but comparing to other apps, it is on par (similarly bad).

Re: Netflix is not a tech company (2019)

#85

Post by omarhaneef »

wffurr wrote: post #72
chipotle_coyote wrote: post #63

Earlier quoted context omitted.

> Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. "X makes money, therefore they are not a tech company" seems rather oversimplified in the same way "X is a tech company" is oversimplified. Actually, it seems oversimplified to the point of maybe not being so useful. I think the way most people would define "tech company," if they were pressed…

There's a third category that you're missing, and it's where the definition gets real blurry. There are companies that effectively use technology to outcompete (or "disrupt") incumbent companies in a market. Amazon in retail, Netflix in media, Craigslist for classifieds, Uber for taxis, etc. It seems as if many existing companies, like Cadbury's perhaps, aren't able to effectively re-work their business models with t…

I like this definition, but I think it should be associated with a strategy rather than a company.

So Netflix is using a tech strategy, but it won't forever be a tech company.

As the particular technology a company deploys becomes widespread, then everyone will deploy it and it will no longer be a tech company.

To put it another way: Netflix was not a tech company when it launched and was mailing DVDs, it became a tech company when it started its streaming service, and as other companies also launch streaming services, it won't be a technology company in the future.

Re: Netflix is not a tech company (2019)

#88

Post by citizenpaul »

This whole thing is pointless. It is basically about clarifying the definition of a financial/MBA term. Where do you draw the line at "tech company" vs some other classification? It only matters if you need to check a box on a portfolio investment diversification.

If a company came out with a fully automated oil drilling solution they are a tech company. Tech defined the company even if the majority of their business 20 years later comes from the fruit of their technical development labor. Netflix is tech company that now mostly makes money from content.

Re: Netflix is not a tech company (2019)

#89

Post by philipov »

chipotle_coyote wrote: post #63
Areading314 wrote: post #3

We should stop thinking in terms of "tech companies" and think of them in terms of "companies that use tech with a high degree of success". Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. Also, with the right incentives and management it is possible, although hard, for legacy companies to start using tech better to compete.

> Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. "X makes money, therefore they are not a tech company" seems rather oversimplified in the same way "X is a tech company" is oversimplified. Actually, it seems oversimplified to the point of maybe not being so useful. I think the way most people would define "tech company," if they were pressed…

I like this definition, but I think it breaks down even if you're not trying to be clever. AWS is a tech company. Amazon is not a tech company, it's a retail store. But AWS isn't actually an independent company, it's just a division of Amazon. So we've got a retail store hiding a massive tech company because the retail store is even more massive.

I think this is less a flaw of the definition and more a sign that Amazon should be broken apart and AWS spun off as an independent company.

Re: Netflix is not a tech company (2019)

#90

Post by jcims »

Buttons840 wrote: post #21
Areading314 wrote: post #3

We should stop thinking in terms of "tech companies" and think of them in terms of "companies that use tech with a high degree of success". Ultimately any company that makes money is not a tech company because pure technology on its own does not make a business. Also, with the right incentives and management it is possible, although hard, for legacy companies to start using tech better to compete.

I was thinking the same, but you said it better. How many "non-tech companies" are non-tech companies simply because they're too disfunctional to use technology effectively? Think of your bank with its shitty password rules, only offering 2FA using SMS, and no useful APIs; that's a non-tech company. They either aren't aware of their lackluster technology, or are unable to organize themselves well enough to improve it…

Large banks have an entire universe of challenges that don't impact firms like Netflix or Google. I've worked with enough of them and seen many high speed engineering folks from FAANG companies flounder for months as they try to recalibrate for the highly regulated environments.

I'm not saying banks are great at tech, because on any individual metric it would be really hard to find an example of where they lead, but they (and other highly regulated industries) have a lot more to solve for along the way.

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