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Netflix is not a tech company (2019)

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Re: Netflix is not a tech company (2019)

#171

Post by bumby »

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…

>a tech company is one that derives the bulk of their revenue from selling technological goods and services

How would you define pre-AWS Amazon? It doesn't seem to meet this definition, yet I think most would still consider them to have been a tech company

Re: Netflix is not a tech company (2019)

#172

Post by crazygringo »

wrs wrote: post #138
crazygringo wrote: post #42

This is utterly ridiculous. I think it's generally understood that, in the 21st century, a "tech company" is a company that uses tech as the principal competitive advantage to replace traditional "non-21st-century-tech" incumbents. Obviously, Netflix used streaming, collaborative filtering recommendations, and a massive CDN to replace cable TV subscriptions. If that's not a perfect example of a tech company, I don't…

So you and the author have exactly opposite perceptions of what is “table stakes” (tech or content) and where the strategic advantage in the streaming business lies… Perhaps one missing piece is that there is a first-mover advantage to being the tech disruptor, but in many cases the tech quickly becomes “table stakes” and the strategy goes back to where it was.

Netflix figured out data-driven streaming better than anyone. That's its competitive advantage, full stop. It purchases content based on unparalleled data analysis, i.e. big-data tech. They often don't even order pilots (previously unheard of), they're so confident in their statistics.

A useful contrast is with HBO. Yes HBO has a streaming service and app... but its competitive advantage is in prestige content people will pay $$$ for. Somehow HBO's management team is incredibly good at nurturing content in an artistic critically-acclaimed way, rather than tech-data-driven way.

For Netflix, tech is the primary differentiator and the content is table stakes. While for HBO it's reversed. It all depends on how a given company is choosing to compete in the same market.

Re: Netflix is not a tech company (2019)

#173

Post by neogodless »

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 really like the focus on strategy (or tools) rather than trying to label the company itself.

Across many industries, especially in the past several decades, companies have used (modern) technology to compete, and the successful ones grew and gained recognition for good application of technology.

Google, at the core, doesn't sell technology to consumers. They help people find and share information. (Yes, they sell consumer products that have evolved in the technology age, and we often call a phone or a modern speaker "technology.")

Apple is a consumer products company. Microsoft is (by revenue share) an enterprise solutions company. (This includes software, hosting, APIs, etc - all technology.)

As sibling comments have pointed out, from the beginning of their existence, automotive companies took the newest technology (initially motorized transport!) and used it to sell personal transport to consumers. Technology is in almost everything sold (except when it clearly isn't... food, most clothing, some services) or it's used behind the scenes.

Overall, what value do we get from trying to draw a line between technology company, and "not" a technology company? Netflix by itself doesn't really try to sell you technology, and yet they were instrumental in selling smart TVs and streaming boxes.

Do we want to know as prospective employees? Knowing if we are cost centers or profit centers?

Re: Netflix is not a tech company (2019)

#174

Post by duped »

crazygringo wrote: post #42

This is utterly ridiculous. I think it's generally understood that, in the 21st century, a "tech company" is a company that uses tech as the principal competitive advantage to replace traditional "non-21st-century-tech" incumbents. Obviously, Netflix used streaming, collaborative filtering recommendations, and a massive CDN to replace cable TV subscriptions. If that's not a perfect example of a tech company, I don't…

> Yes Netflix needed a good content library too, but that's never been its primary differentiator. NBC and HBO have been producing good content for many decades now. That's table stakes.

It's pretty much the only differentiator, and what people mean when they say "content is king." Very few companies can compete with Netflix on fidelity and technical performance. Yet Netflix is second fiddle to industry giants that contracted out their streaming platform development, because ultimately consumers care more about what they're watching than how they watch it.

Re: Netflix is not a tech company (2019)

#175

Post by saalweachter »

musingsole wrote: post #150
saalweachter wrote: post #27

Earlier quoted context omitted.

Eh, as a user Netflix original content is a large part of why I still have a subscription. I used Netflix back when it was mailing me DVDs, and loved the online streaming back in the halcyon days when it seemed like they had everything . Then came the dark days when content owners began pulling their IP from Netflix and scattering it all over the internet behind a dozen different options that offered them more money…

> It didn't matter what their UX or uptime was or how smooth their video codecs, they didn't have enough content I wanted to watch. Netflix has developed a novel data system (as evidenced by papermill) that is likely responsible for countless decisions that manifested the content which brought you back. I don't know first hand but I suspect data is integrated into their everyday processes in ways most companies can't…

And Disney/Pixar is constantly pushing the bleeding edge of computer animation and CGI special effects. Is Disney a technology company?

Re: Netflix is not a tech company (2019)

#176

Post by nkohari »

cblconfederate wrote: post #124
crazygringo wrote: post #42

This is utterly ridiculous. I think it's generally understood that, in the 21st century, a "tech company" is a company that uses tech as the principal competitive advantage to replace traditional "non-21st-century-tech" incumbents. Obviously, Netflix used streaming, collaborative filtering recommendations, and a massive CDN to replace cable TV subscriptions. If that's not a perfect example of a tech company, I don't…

> streaming, collaborative filtering recommendations, and a massive CDN Did they develop any of these technologies?

...yes?

Re: Netflix is not a tech company (2019)

#177

Post by tomrod »

cletus wrote: post #148

Here's the framework I use: "tech companies" are those where tech still plays a significant factor in the growth of the company such that it's important to an executive level. Example: Google is still a tech company. As much as some might view search as "solved" (just like it was when Google was founded I might add), search continues to get better. Tech still plays a significant role in the actual core business (ie a…

Tech firm: your product team creates externally used technologies.

Not tech: tech improvements are internal and/or your IT staff is all about maintaining/integrating external products.

IT as cost center versus profit center may be a useful distinction.

Re: Netflix is not a tech company (2019)

#178

Post by cletus »

jerf wrote: post #166
websap wrote: post #159

Earlier quoted context omitted.

> serving several thousand VODs and that problem is solved You're kidding right? You think this problem is solved? Try using HBO. A tech company is any company that understands it can leverage technology effectively to run a more efficient organization. They treat tech as the way to solve problems rather than throwing people at the problem.

It's solved by Netflix. Doesn't mean it's solved by anyone else, though there are also quite a few other companies that have it "solved" for their level of usage, even if they couldn't flip the switch tomorrow to become Netflix. "Solved" also doesn't mean there aren't people maintaining it or working on it or getting woken up at night by pages to keep it going. It just means, they've got a handle on it and when the N…

Exactly this.

It doesn't mean there isn't room for improvement. Others have pointed to UI issues, for example. It just means the state of the tech probably isn't the top of mind for the C-team and the board.

Re: Netflix is not a tech company (2019)

#179

Post by desas »

samhw wrote: post #136
dralley wrote: post #56

Earlier quoted context omitted.

I agree. What most HN commenters seem to really mean when they say "technology" is "consumer software", or more cynically, "company is made of mostly software engineers". There is an incredible amount of advanced technology being created and used by more "traditional" industries like manufacturing, aerospace, or animation. Why should Facebook be considered a technology company but not Pixar, Ratheon, General Dynamics…

> company is made of mostly software engineers This hits the nail on the head. If you dig down into it, this almost always aligns with the companies people describe as 'tech companies'.

Uber is mostly made of drivers, yet is considered a tech company. (I'm aware drivers are not technically employees).

Maybe it's more to do with the strategy of the company.

Re: Netflix is not a tech company (2019)

#180

Post by markus_zhang »

Once a company has grown to certain stage it HAS to be centered on business. So the ideal life of a technical person is to:

1: Join a start-up

2: Work hard to grab as much technical fields under belt as possible, preferably be the CTO or one of the tech director/VP

3: Leave when it's broke/successful enough to be less technical related

4: GOTO 1

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