Netflix: streamed flicks instead of DVDs
p2pnet news view | Movies:- Netflix DVD rentals added more subscribers than ever during the first three months of the year, but CEO Reed Hastings [right] believes DVDs by mail will steadily lose ground to streamed movies.
“So,” continues the Wall Street Journal, “Mr. Hastings, who co-founded the company, is quickly trying to shift Netflix’s business — seeking to make more videos available online and cutting deals with electronics makers so consumers can play those movies on television sets.”
But Pali Research’s Brandon Ross thinks the going might be more than a little tough.
Quoting Hastings from the WSJ story, he says the’ projection that rental numbers will begin to come down in “four to nine years” will probably be closer to four than nine but, “Nonetheless, the company has been preparing for that decline by investing in its streaming product.”
Netflix’s streaming product is limited, says Pali Research, and much of it can be found online for free — “especially TV shows”.
So to, “take the streaming product from being a supplement to the DVD by mail business to becoming a replacement for it, the company is going to have to offer more and better titles,” says the post, going on, “It is clear that the company knows this and is preparing itself – even at the expense of current profitability – by trying to swing deals for better titles,” but, “how good will these titles ever get?”
Lastly, Netflix isn’t the only company looking to, “have a hand in the digital video marketplace,” says Pali Research, adding it’s already facing competition from “well capitalized and technology savvy companies” such as Apple, Amazon, and Google.
And as Hastings himself says, “I’d rather have Blockbuster as my primary competitor than all those Internet companies.”
First they ignore you, then they laugh at you, then they fight you, then you win ~ Mahatma Gandhi
Wall Street Journal – Netflix Boss Plots Life After the DVD, June 23, 2009
Pali Research – WSJ Article is a Reminder of Risks Facing Netflix, June 23, 2009
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