Netflix Is Going to Rule TV After All
wired.com
wired.com
This is filler; they are no more inevitable now than they were doomed a year ago. It's still a rapidly changing landscape, they still own a lot of the territory, and it's still very difficult to guess the future. (My only guess is a negative one; the market is not stable with every content company owning their own streaming service, because consumers are not going to pay 15 bills a month for video content, no matter how cheap they are. Someone's going to aggregate, somehow. My guess about the how is something more like an Amazon hybrid model of subscription + optional premium content, but Netflix is putting up a good fight on the subscription-only side, so.... shrug.)
The other day I was trying to binge watch a season of a broadcast TV show, so I tried the On Demand thing on the FIOS cable box. Just 5 latest episodes available. Fine, this dinosaur is dead anyway, so I go to Hulu Plus; surely they will have the whole season, that's why you pay the sub, right? 2 latest episodes available! WTF.
These incumbents are not competing with Netflix et al, they are actively burning the subscriber base and encouraging them to switch. I think if they put up a huge banner saying "Please don't use this site and go to Netflix instead" I would probably spend more time there than now. Sad panda is sad.
As far as I know, Netflix doesn't have current season of TV shows at all. So Hulu Plus and the cable 'on demand' services are mostly complementary to Netflix, purely complementary if you buy Hulu Plus for access to current season shows.
When enough people find piracy convenient enough to use as their full-time solution the market will evolve a reasonable monetized solution. Until then there is not enough incentive for the content producers.
Sad panda will stay sad for some time.
No, you pay for Hulu Plus so you can watch ads in pay TV...
It's Wired.
I imagine middle ground doesn't make for good link-bait headlines, so this is true of most media outlets (even prestigious ones).
Netflix is still the biggest, but so was Blockbuster and then the game changed. When cable rates go poof, the game will change again.
I don't have a doubt Netflix will survive, but it will be one of many and probably the Indy / small provider company, if Amazon doesn't run them over.
1) even MLB
It all comes down to sports for many. If Netflix of Google TV begin to seriously bid for sports contracts things will change very soon. Similarly if traditional sports outlets like ESPN or Fox would cut their cord requirement (even at an egregious per-subscriber cost to start off with) the landscape will really start to shift.
Oh really? Netflix is far ahead of the competition when it comes to device support. And the streaming technology plays a lot bigger role than you might imagine, especially when it comes to live content. Contrary to popular belief, this is not a solved problem. Like I mentioned above in another comment, just try watching a streaming NBA game.
And most of them suck ass. You can't stream an NBA game live without it buffering the crap out of itself.
> if Amazon doesn't run them over.
Based on what Amazon has done so far, it doesn't stand a snowball's chance in hell. They have no understanding of content - their recently released pilots were horrible. You can let a bunch of tech guys up in Seattle make content decisions.
As for Amazon, they'll do what they do best, buy content from everyone.
1) the MLB has home or away announcers and HD video - much better than the cable version
That's the crux of it. There will inevitably be good and bad shows, or even good but unpopular shows. The viewers are fickle and Netflix will need to somehow manage keeping their attention. Netflix's problem is that they don't own the content. But as soon as they enter the content-creation business, they will be the same as Disney (and will face the same challenges).
Netflix is still at the mercy of the internet providers, which are increasingly also controlled by the major content studios. Comcast just won a huge net neutrality battle and is making a play for Cablevision. Netflix has said it's willing to "mobilize its users" against traffic throttling abuse. Netflix's goal is to become Disney before Disney can become Netflix.
They've got better data and infrastructure. And they seem to have a one-up on a culture that lets them be flexable with IP. We'll see what happens.
http://www.macworld.com/article/2042405/hbo-go-watchespn-com...
In addition Netflix has built up infrastructure to allow it to stream in high def in the first place. They are peering near ISPs in large localities to reduce bandwidth costs and improve speeds to the user.
On top of that, how often does your netflix stream stop to buffer? Almost never. They've encoded every file in almost every possible resolution and bitrate and the player seamlessly switches amongst them as the connection slows or speeds up.
Remember, it's not about streaming on your laptop, it's about your television. Forget about the browser experience.
I'm constantly in amazement of Netflix. There is so much more to them than merely acquiring or creating content. To say that Disney and TW will simply setup their own services with great ease discounts the barriers to entry that they will face, as well as the significant costs.
The whole point is that Netflix is racing to build up infrastructure and IP so that the economics of Disney starting its own streaming service instead of getting revenue by streaming on Netflix will not make sense.
Disney charging each customer instead of the cable share is going to be above the money Netflix is willing to pay for all of Disney's content. All of the big players have quite a lot of content they are currently getting ready for digital streaming. Disney and HBO are already on Apple TV and others (heck Disney is there a couple of times).
Netflix doesn't have the money to scale up to their content machines before the cable money goes. They'll live if Amazon doesn't get aggressive.
Try Vudu if you want to see real dependable HD. I've had issues with Netflix "blocking up" (pixalated) while the Vudu stream is fine and the picture, in my opinion, is better than any other service out there.
ESPN is Disney. There have live TV, replays , highlights streaming online already. Adding some non sports content won't be trivial, but they aren't starting from ground zero.
What is the point of having a nice online delivery mechanism if you're required to have the cable channel to use it for the good content? I mean I like online and all, but if I already have cable and have to choose between the two, I'm picking cable.
The same argument applies to the HBO product. To me, the entire point of having an online offering is to reach more people. If you're immediately limiting your potential customer base to your existing customer base... How is that supposed to really work?
As far as the actual product goes, I have cable. I still watch ESPN on my Apple TV because the replay functionality is really nice. I don't need to pay for a DVR (or HD) to watch the teams I want to. That's pretty cool.
I don't understand why people think Disney will start their own streaming service when they never started their own cable TV company. Large public companies want to get a high return with as little capital invested as possible, which means they will always prefer licensing their IP rather than owning metal.
I know people who complain about the content Netflix has every time the subject comes up. They don't know why, or understand what licensing is (or means), or the impact of the studios and their business model.
They could buy movies on disc, and get whatever content they want, but they use Netflix more and more instead. So experience does matter.
Talk to my wife who searches around Netflix for 15 minutes looking for something to watch and then gives up. Experience can improve the likelihood that someone will use your service, but if the content isn't there, then they'll go elsewhere.
If the cable business does die those companies could partner with Netflix, split revenues (and risks) and continue commissioning shows.
Content available on Netflix would go up, they could jack up the price (one place to view everything justifies that) and the cable companies don't go completely out of business.
It'll probably never happen but it seems like an ideal solution for all parties, including customers.
You have to believe that Google cares about TV and video content. They've made so many moves in this direction: YouTube, movies and TV on Google Play, the deal for Girls (or whichever show it is) to premiere on YouTube before anywhere else…
The challenges Netflix has are three-fold as I see it:
1. They only have enough cash at hand to do, what, five pieces of amazing original programming each year? Six? The halo isn't big enough to make them huge like YouTube is huge.
2. Google has an insane amount of cash. They could really "unify the division" by creating the first truly undisputed king of content streaming (which would just be YouTube + licensed movies and TV shows with a premium version and a heavily ad-supported version). They could also finance new shows.
3. Content owners can see Netflix's share price. As soon as they start doing well the price will go up on content licenses. Unless Netflix negotiate 5, 10, or 15 year terms they aren't going to be able to avoid arbitrary price hikes.
this has been claimed for a couple of years now. It hasn't played out that way so far. I haven't looked closely in 6 months but generally their content costs have been flattish rather than a sharp escalation (this is after the ramp up to make their initial content acquisitions).
Furthermore, I think there are 2 reasons why content providers won't be in a great bargaining position.
1. Part of what makes a show a success is the built in audience. Think Friends or Seinfeld ... Thursday night prime time slot used to guarantee an audience in the millions. The networks don't have that advantage anymore. It's Netflix that has a guaranteed audience of millions.
2. If content providers push for major price increases, Netflix has the option of producing their own content, which they've shown they are capable of.
Netflix has been disciplined in their content spending. I don't think content providers will be in a position to change that.
As a result, at the moment I'm paying for both Now TV and Netflix, but when I want to watch a movie I'm much more likely to go to Now TV, so maybe next time I sign up for those things I'll get just Now TV (or an equivalent player that actually has content licences to good things).
Hulu+ requires you to link with your cable provider to watch a lot of the new stuff anyways which is a no go for me since...the point is not having a cable provider anymore.
Also...entire series simply don't stream if you're on Linux. Community and Linux-Flash don't work for example, something about their crappy DRM.
Netflix isn't exactly Linux friendly (Silverlight) but the Wine Netflix-Desktop at least works for all their content.
Antagonizing HBO isn't smart imo. Pretty juvenile comments.
They aren't taunting HBO because they want anything from HBO. They're taunting HBO because they want consumers to see them taunting HBO. It's just marketing.
I personally enjoy both Netflix and Hulu+. They are different use cases. Hulu+ for current shows, while Netflix for the rest. The only thing I dislike from Hulu is the ads.
You can see this from Netflix's crappy selection of streaming videos compared to their selection of DVDs. Not to mention that films mysteriously appear and disappear from the streaming library due to license expirations.
No way Netflix would want to do that on their own.
With a hit series that they own:
1) Subscribers know that the series will never go way. 2) Once a season is the bag, the return on the season is really high going forward as there is no cost to show the episodes (ie. no content fees)
All this means that Netflix will continue to fund new series and find ways to bring the cost down. The future returns on a series is just to big to ignore for them to not do it.
I absolutely love Netflix, let's hope they manage to keep ahold of their catalog.
With Kevin Spacey?
http://en.wikipedia.org/wiki/House_of_Cards_(U.S._TV_series)
I feel the idea of releasing the whole 'season' at once is perfect for the Netflix model. No need to drag it out: Netflix knows their core base likes to marathon binge on good TV.