Netflix Reaps What It Sows

Netflix Reaps What It Sows
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They are incentivized to maximize 1) paying subscribers who 2) actually watch as little as possible.

NF might be being punished for nkt having envisaged this.

I mean, their core business is content, and they know the mightbof the likes of Disney and HBO.

1. On their subscriber numbers and growth trajectory:

Don't forget to consult streaming marketshare. [1] Netflix is still the market leader, which is perhaps why they command the highest prices: nobody's willing to give up Netflix. Their competitors are trying to catch up with lower, potentially unsustainable pricing.

Commentary surrounding their content has been emphasizing some of their more high-profile duds, but the truth of the matter is that most people's TV habits encompass much more than big-name high-budget dramas like Stranger Things. We're talking reality shows, crime procedurals, and other "trash TV" like that. In that regard, I think Netflix does just fine, offering a variety of original content. (E.g.: Selling Sunset)

2. On their password sharing controversy:

Netflix has been getting a ton of flak for some policies that they're considering and haven't yet rolled out.

I give Netflix a lot of discredit for bungling their PR on this issue, and publicly going against the way their own customers feel about password sharing, but so far this functionality is limited to just a few test markets. [2] They have plenty of leeway to completely abandon and walk back this strategy.

3. On their consideration of adding advertisements:

I am completely mind-blown that this is a criticism of Netflix – again, for a policy they have yet to implement. Plus, many of their competitors, like Discovery+ and Hulu, already have lower price ad-supported tiers as an option. Hilariously, people complain about the price of Netflix and simultaneously throw them under the bus for thinking about adding an ad-supported tier.

4. On their content's quality, frequent cancellation of shows:

People who complain about Netflix's content quality, canceled shows, and other similar criticisms are really not actually looking at their competitors. This isn't some kind of unique thing to Netflix.

5. On my latest conspiracy theory:

Many press outlets have ownership stakes and/or other relationships that incentivize them to publish dirt on Netflix.

Think about it: you see a news story about Netflix on ABC or CBS news, they're owned by Netflix competitors. They have a vested interest in the news about Netflix being negative. I wonder how many news outlets publishing stories about Netflix have that type of relationship? It's almost hard to tell exactly. [3]

Finally, I've got one little beef with this article:

> Hulu, Disney+, and Paramount+ are other major players that are looking to eat Netflix's lunch. One big difference: they offer LESS content, but more specialized. Let's face it: Paramount+ is Star Trek. Disney+ is Star Wars and Marvel. Hulu is Handmaid's Tale. As of right now, Apple TV+ is Ted Lasso, but Severance is fast becoming a second tentpole show for the service.

This is a massive over-simplification and underselling of the other streaming services. I wouldn't call Hulu, Disney+, or Paramount+ "specialized." Paramount+ is way more than just Star Trek, it's also a massive soccer destination for UEFA Champions League, Europa, and others, NFL on CBS, and a number of Paramount Media Network cable channels' content (Nickelodeon).

Disney+, beyond Star Wars and Marvel, is the entire Disney and 21st Century Fox back catalog (incl. The Simpsons) and numerous other family shows (Bluey)...not to mention the ESPN+/Hulu bundles you can get with Disney+.

Hulu, again, part of the Disney empire, encompasses a wide breadth of cable TV content. Giving Hulu credit for The Handmaids Tale undersells their more recent original hits like Only Murders In the Building.

Apple TV+ is expanding way more rapidly than is given credit for, it's not just Ted Lasso and Severance. If you keep up with their announced premiers you can see that TV+ is trying to build out a general media destination. Rumor has it that Apple TV+ is getting NFL Sunday Ticket. [4]

And then...HBO/Discovery+ just aren't mentioned at all! I know there are controversies surrounding the new management at HBO Max, but the combination of Discovery Networks with HBO is a powerful general-purpose streaming service.

Now, here's the thing, you're probably by now thinking that I'm just making the case that Netflix is facing fierce new competition. Yes, in a lot of ways, that's true, but I also see an expanding market where cable subscribers and the live cable TV industry itself are still in the process of the complete migration to digital streaming. There are still tens of millions of people spending time on live cable television/DVR that will in the future inevitably shift some of that time toward streaming. [5] There's a lot of money to go around on television, and Netflix isn't going anywhere.

[1] https://www.cordcuttersnews.com/report-hbo-max-overtakes-dis...

[2] https://techcrunch.com/2022/07/18/netflix-test-add-home-opti...

[3] https://www.vox.com/2018/1/23/16905844/media-landscape-veriz...

[4] https://www.macworld.com/article/633375/apple-tv-plus-nfl-su...

[5] https://techjury.net/blog/cable-tv-subscribers-statistics/

netflix used to be a bit like youtube. A platform where content creators (e.g. the big movie and TV studios) would distribute their content (first on DVD, later on streaming).

netflix today is a content creator hosting it's own content. Similar to HBO or Disney or Paramount or whoever else.

Different business altogether really that can hardly even be compared.