I have made huge profits from Netflix stock since 2014. But I no longer believe in the stock. I understand they have some of the best software engineers, content production teams, content distribution network etc. But I myself have significantly reduced going to Netflix in the last one year. With YouTube pushing premium subscription, Amazon prime acquiring MGM, HBO tie up with Warner bros, Disney releasing new movies on Disney+. Do you really think Netflix has a chance to differentiate itself in long run?
I sold my nflx stock at 90+ because I don’t think it’s worth so much more than Amazon prime video, Hulu etc. the stock has proven me wrong so far. But I still hold on to my believes and won’t buy into nflx.
On the content production side Netflix is spending a lot. Traditional producers (Warner bros, paramount, etc) are losing talent to them because they can’t overpay like Netflix does. But they can’t do this forever and ultimately it will come down to content library as the streaming service is not special anymore. In my opinion Netflix has reached a saturation point of households and will gracefully fall back to earth to be just another streaming company with maybe the best content library and customer base. This could take 10+ years. But the days of cheap libraries are over as there are many players in the space now
Most of their content is junk. Even worse, a significant portion of it is woke junk. Some of their new stuff is cringe. They have a long way to go before they can compete with Disney, HBO or even WB.
Netflix is the only profitable streaming business. At the same time spending 3-4 times as much as Disney+, HBO max on content. The gap is only getting bigger every year.
So I think you misunderstood the business model. None of these need to be unique, they just need to convince enough people that there is enough content they want each month. Best case for Netflix (or any other service) is that you pay for the month but only use a few days. As long as there is sufficient content to make you pay for the month, all of them are doing well.
Also noticed some talk of saturation but that is only US saturation… biggest growth is overseas
Sure, similar to one of many cable TV companies! That is not good for Netflix future.
No matter how you look at it, covid saved Netflix. Sure, Netflix has good “original” content but, that’s not going to cut it. And most of the growth in last few years is abroad - not in US.
“I understand they have some of the best software engineers, content production teams, content distribution network etc.” If I’ve learned anything about the tech industry of the last 20 years, it’s that best tech over everything. Disney, Hulu, Peacock will all struggle to keep up with any tech advancements. Netflix could stop burning $ on content and rake in rents for decades on the things that are “must have” for many people. Remember, it doesn’t matter to Netflix whether you have Hulu, Prime, etc too, as long as you still have something that ensures you have your Netflix subscription.
I believe, it matters for Netflix if I have subscribed for multiple other providers. Not immediately but in long term.
Content is a war of spending, can netflix outspend google and amazon for content? Don’t think so
LOL. Netflix has a way bigger content budget than Amazon and Netflix is profitable. All public companies need to answer to investors. You can't just burn money for the purpose of burning money.
What’s the difference between Netflix burning $$ and amazon burning $$?
The war is not just about streaming, but eyeballs. You should notice linear TV businesses are losing ground very fast. And Netflix is gaining a bigger piece of pie every year. Content business is not search engine. No one can take the entire market, you can have multiple winners. Netflix is positioned to be the biggest one.
Respectfully, I think it hurts netflix margins by being one of many, it may not show up immediately but in 5-10 years unless Netflix does something different than the rest.
Apple. You are one of many and you have a higher profit than the rest of the industry combined. I respectfully disagree. TV/movie is a 500B per year business. Netflix is at 25B last year. Plenty of room to grow. The cord cutting secular trend is enough to double Netflix revenue by itself
Netflix IS one of many.