Netflix was a first mover. Turns out they created a technologic berm instead of a moat.
My question is what other industries are going to end up gobbling up their first movers.
Personally I think Amazon is next. They exist based solely on their first mover momentum.
Netflix market cap is $210B, Comcast is $178B, and Disney is $160B. All the other content sellers are far below.
Netflix is a perfectly viable business, and investors are betting it will continue to be a leader in selling video media.
> Turns out they created a technologic berm instead of a moat.
Unless Netflix had a plan to lobby legislators to enact laws coercing content makers to go through them, I do not see what chance they had at making a moat due to the way the internet works.
>Personally I think Amazon is next. They exist based solely on their first mover momentum.
Amazon actually has a moat. Creating all the warehouse and transportation infrastructure and managing the 1.5M employees they have is not a simple feat, certainly not relative to setting up a streaming service. Not to mention AWS.
In no world is that worth more than Disney, who own the rights to some of the world's best known franchises, several theme parks, retail stores, and quite a bit more I'm forgetting off the top of my head. Oh, and they have a service you can pay a few dollars a month for streaming video as well.
At some point investors will realise that while the emperor isn't entirely naked, he's just wearing an outfit he picked up from the supermarket while doing his shopping, and not a revolutionary new material.
Netflix started in 1997, IPO’d in 2002, launched streaming in 2007 (the same time NBC and News Corp launched Hulu), and has reported $100M+ net income since at least 2010, and $1B+ since 2018.
> At some point investors will realise that while the emperor isn't entirely naked, he's just wearing an outfit he picked up from the supermarket while doing his shopping, and not a revolutionary new material.
Netflix is not valued as revolutionary new material. It is valued as having solid cash flow, minimal liabilities (few employees and physical facilities), and low debt.
Disney and Comcast have much more liability from having many more employees and in person interactions with the public.