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Comment by paxys | Hacker News Reader

Did you honestly think you would get all content ever created, old and new, for $10/month without ads for the rest of your life?

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Renting DVDs costs about one or two Euros per DVD and they have to have physical stores and employees and can only rent a movie to one person at a time. The cost of streaming a movie to a customer is close to zero. I think it's reasonable to expect being able to stream a movie for at most one Euro. I don't watch a movie every day, so ten to twenty Euros a month sounds realistic.

Renting movies or TV episodes for a dollar or two is possible even online. People want a lot more than 10 movies a month though.

You're only talking about the infrastructure cost in that equation of distribution. The issue is that the movie owners want to be paid for their content availability even if few people watch it. There isn't much Netflix can do about that. You're not just paying for how many movies you watch per month (eg 10), or how much bandwidth you consume, you're paying for access to all of the content Netflix offers. It's a communal distribution of cost across the entire customer base to enable an artificially large library for the masses with all their variety of taste. Why? Because they have to pay all the content owners, or they walk. Those content owners effectively get a little sliver of your monthly fee. If Netflix increases its catalog of movies from external owners by 4x, the sliver gets smaller per movie on average (or they have to raise prices a lot). They'd have to convince content owners to give them most movies for free.

Consider the model of monetary distribution based on actual watching of content. If you're a movie library owner, with a catalog of 1,000 mediocre quality studio movies to offer up to a streaming service, are you going to take close to $0 from Netflix based on few people watching the content there, or will you take a lot more from a competitor that needs filler content to take on Netflix? Due to this effect it's impossible to distribute the majority of movies on streaming services based on how often they're actually watched (the demand for them). There will always be some other service willing to bid the bottom quality 3/4 of movies up.

If all of their customers globally were actually willing & able to pay ~$22 per month for Netflix streaming, they could probably technically afford to give you access to nearly all movies ever made at today's licensing rates. Hollywood won't comply with that however, not under any circumstances. Netflix can realistically never afford to pay Disney enough to not launch its own competing service.

Maybe. $10/month times 1 billion people is $120B a year... that should be enough to run an entertainment industry.

There aren't a billion people on this planet that can afford to pay $10/month for entertainment.

The US has 325m people. The EU has 512m people. Let's conservatively assume that half of these spend $10/month on entertainment (e.g. by going to the movies once a month, or paying for any sort of TV subscription). That's already over 400m people, and that's before we start considering other developed countries with a lot of people (e.g. Brazil, Argentina, Turkey, Japan, South Korea).

That's just a back-of-the-envelope estimate, but yeah, I'm absolutely confident that there are over a billion people right now who already pay $10/month for entertainment media.

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