
Netflix is not the future of TV - dmarlow
https://www.forbes.com/sites/stephenmcbride1/2019/05/21/netflix-has-175-days-left-to-pull-off-a-miracle-or-its-all-over/#42146aa275c4
======
xrd
I feel exactly the opposite about signing up for Disney. I will not. The
reason is stated in Fast Food Nation, paraphrased as: "Disney was the first
company to direct market to children." They are still the company I most fear.

As an example, I hate going to the super market with my kids. We don't watch a
ton of Disney movies, but even so, they are bombarded with Frozen shit six
years after that movie came out. There are all kinds of things to buy marketed
with Frozen that my kids would have begged for, IF we had been watching Frozen
incessantly, if we had Disney+.

I will NOT be signing up for this. I would much rather watch the shows on
Netflix that I know will never have plastic junky replicas occupying on shelf
space in the supermarket. Frozen was an amazing story, and Disney has
fantastic writers, directors, and animators, but I don't want them hypnotizing
my kids and then trying to sell them shit for years.

I'm probably in the minority in that I have never seen one of the Avengers
movies, and could care less about those blockbusters the author listed. But, I
really do think we are entering a new phase in media consumption where I as a
parent can choose my own streaming needs (HBO, for example, with little that
my kids watch) AND I can find the right combination for my kids (Netflix and
YouTube) that fits my need to avoid marketing to my children. I'm sure someone
in those channels will find a way to sell crap to my kids, but it'll take some
time.

I think there will still be people who want to watch the Avengers sixteen
times on their five different screen sizes, and will sign up for Disney+. But,
it might not be as many parents as they would hope for, and I have
alternatives and won't be one of them.

~~~
IgorPartola
I have two girls. Netflix seems to have the most girl-positive shows that
aren’t cheesy or cheap. I generally have a pretty negative view of Disney and
wouldn’t sign up for it for the same reasons as you.

~~~
jkmcf
I agree. My daughter loves Spirit. OTOH, she also loves Disney's Elena of
Avalor, which I think is exceptionally well done. The Disney stuff targeted at
older kids seems pretty horrible to me.

~~~
xrd
Yeah, Disney has definitely improved with their content. I don't like being
marketed about Frozen, but I do love the story of Frozen: the love of two
sisters saves them NOT a handsome man.

It's just that Disney is like the scorpion and the monkey story
([https://en.wikipedia.org/wiki/The_Scorpion_and_the_Frog](https://en.wikipedia.org/wiki/The_Scorpion_and_the_Frog)).

"I couldn't help it. It's in my nature."

They just can't help but try to sell a bunch of shit to my kids.

------
burlesona
Seems like crazy click-bait to me. Yes, the competition in streaming is
heating up, but in reality most people are likely to pick and choose a few
services, not just one. Cable packages have been running $50+ per month for a
while now, with millions of customers. Cord-cutting down to Netflix + Prime +
Disney is still cheaper, and it’s getting closer to the system I think most
people wanted all along, which was the ability to pick and choose your own
bundle of just the channels you want.

What has really changed is linear TV (aka traditional channels) is going away
in favor of on-demand. People care about live sports, and to some extent live
news. Other than that, on-demand is better.

So instead of the future being what we might have imagined 10 years ago,
building a bundle of just the channels you want, instead will be building a
bundle of just the distributors you want — ie. Disney originals vs Netflix vs
Prime etc. I expect we will see more and more content signing exclusive deals
with these aggregators as a result, and we probably also see a few more big
brands throw their hat in the ring.

~~~
TAForObvReasons
The problem as articulated in the original article is that _Disney 's service_
is an existential threat to Netflix both because Disney will offer currently-
unavailable content and because the Disney IPs are slated to be removed from
Netflix.

Netflix's problem is best captured in this sentence:

> Netflix users are spending more time streaming “The Office” than any other
> show on the streaming platform.

[https://www.indiewire.com/2019/04/the-office-netflix-most-
st...](https://www.indiewire.com/2019/04/the-office-netflix-most-streamed-
series-friends-1202127682/)

Would a Disney streaming service cause people to switch or pay for both? That
remains unclear, but I'd bet on a future of subscription fatigue where people
pay for one video streaming service.

~~~
ymolodtsov
Disney is just $7. It seems reasonable that cost-conscious people would choose
only it, while others can still pay for it on top of their existing Netflix
subscription.

~~~
Phillipharryt
Disney starts at $7. These services always increase their price once they have
customers hooked. I feel the initial plan is to price it so people will layer
it on top of existing services, then have enough content to make it worth
having alone. Then increase the price so that users have to choose between the
services, and pick Disney.

------
Benjamin_Dobell
The author seems to be unaware Netflix started preparing for this _years_
ago[1]:

> _the streaming-video giant put out nearly 90,000 minutes—close to 1,500
> hours—of original series, movies, and other productions this year._

Maybe there is some concern about the quality of the content...

> _In 2018, Netflix also became the first network in 17 years to dethrone HBO
> in Emmy nominations, and matched the premium-TV network in wins._

Netflix isn't going anywhere.

[1] [https://qz.com/1505030/keeping-up-with-netflix-originals-
is-...](https://qz.com/1505030/keeping-up-with-netflix-originals-is-basically-
a-part-time-job-now/)

~~~
scarface74
Everyone knows they prepared for it. But they also getting in tons of debt to
create content with only one stream of income - subscriptions.

Disney+ and Hulu are just an additional income stream for Disney. They have so
many ways to make money off of content and don’t need to get in debt to do it.

\- broadcast TV

\- cable TV

\- physical sells of media

-National/international theatric releases.

\- Rental/purchase video on demand

Sure Disney+ may “lose money” for the first five years, but how much of that
“loss” is paying other units of Disney for content?

~~~
Benjamin_Dobell
> _with only one stream of income - subscriptions_

That's not accurate. Netflix can and do license their Netflix Originals just
the same as any other production studio. They just don't do so as frequently
as streaming is a superior delivery platform (from their perspective) in terms
of user lock-in & profitability (no middle men). Those latter two reasons are
a strong driving force for why Disney (and prior to that Fox) have been moving
into the space.

> _getting in tons of debt_

Do you have a source for this being a concern?

Everything I've ever read indicates their profits are soaring e.g.

\-
[https://www.macrotrends.net/stocks/charts/NFLX/netflix/gross...](https://www.macrotrends.net/stocks/charts/NFLX/netflix/gross-
profit)

\- [https://www.marketwatch.com/story/netflix-is-growing-even-
fa...](https://www.marketwatch.com/story/netflix-is-growing-even-faster-and-
streaming-to-record-profit-totals-2018-04-16)

Granted, I can see there are articles regarding them being in debt:

\- [https://www.news.com.au/entertainment/tv/is-netflix-in-
debt-...](https://www.news.com.au/entertainment/tv/is-netflix-in-debt-what-
that-20-billion-really-means/news-story/1e5878306f458237230f62eea5d4b94b)

However, even that article ends with:

> _SO IS NETFLIX’S DEBT EVEN THAT BIG OF A DEAL?_

> _Nope! Every company has debt. Apple boasts some $US100 billion in debt,
> Disney around $50 billion, and Amazon about $8 billion._

~~~
scarface74
You’re really comparing Netflix with a total yearly net income of less than
$1.5 billion with a total debt of 10.1 billion
([https://ycharts.com/companies/NFLX/total_long_term_debt](https://ycharts.com/companies/NFLX/total_long_term_debt))
to Apple with a total debt of $50 billion with a net income of $57 billion?

Apple borrowed money to pay dividends and stock repurchasing to get around
repatriating income before the tax changes. Netflix is borrowing money to keep
up with much larger studios.

 _That 's not accurate. Netflix can and do license their Netflix Originals
just the same as any other production studio. They just don't do so as
frequently as streaming is a superior delivery platform (from their
perspective) in terms of user lock-in & profitability (no middle men). Those
latter two reasons are a strong driving force for why Disney (and prior to
that Fox) have been moving into the space_

People don’t buy Netflix Originals on DVDs like they do Disney properties.
People are still buying Disney DVDs of movies released 50 years ago. Disney is
moving into streaming as an additional source of income.

------
tiernano
At the price of both of these services, am I the only one thinking "why not
both"? It a LOT cheaper for both than standard cable or satellite (here in
Europe anyway) and both would have stuff the other does not. Title sounds very
click-baity to me...

~~~
tastroder
Out of curiosity, what do you mean with "cheaper than satellite"? Initial
costs of the dish and receiver aside that's free around here.

~~~
denvrede
Could you define "around here"?

I'm from Germany and for premium satellite content (Sky) you pay 25-30 euros
upwards for the movie and entertainment (shows and documentaries) packages.

~~~
tastroder
Oh, Germany as well. Honestly didn't realize these premium satellite things
are still widely used over purely IP based content delivery options so they
slipped my mind there.

------
js2
There is no way Disney+ is going to hand out the entire Disney catalog
including putting movies on streaming the same day as theater release for
$7/mo. This is either a teaser rate or it doesn’t buy you everything. And the
theaters will freak out if they have to compete with same day streaming
release.

~~~
dkrich
Don’t think same day streaming release is a remote possibility because Disney
would be canabalizing it’s theater revenue. I do think it’s likely the only
place you will be able to watch it after it leaves the theater.

------
alanfranz
What if consumers get bored by such "exclusive content" deals, where they need
7 subscriptions to watch the 7 things they like, and they go back to DVDs and
bittorrent?

~~~
elicash
There's zero commitment to these apps. Just choose one for a couple months and
watch everything new in the library and rewatch some old stuff you missed or
want to watch again, then cancel it and go on to the next subscription for
another two months or so.

I don't understand why people think it's a problem to need 6 different
subscriptions -- there's literally no reason to have all 6 at the EXACT SAME
MOMENT.

~~~
dominicr
People are forgetful & passive, so they tend to subscribe and forget.

There are lots of people paying for things they don't need or could save money
by switching subscriptions on & off as needed. This is one of the reasons why
the subscription model is so popular with companies, not consumers.

~~~
lsc
relevant experience:

So I've started to subscribe/unsubscribe to channels through prime. It's
really easy to subscribe/unsub. I unsubscribed from HBO when game of thrones
finished.

But... lots of things? lots of things unsubscribing is horribly painful.

A lot of things you have to call someone, listen to the sales pitch, look up a
bunch of customer data you might not have anymore, and then listen to another
sales pitch and then cancel.

I have started dealing with this by just canceling the credit card. (I've got
one of those cards that lets me generate throw away numbers, so I don't have
to cancel everything) way easier.

So, uh, my guess? my guess is that the 'subscribe to movie through amazon' is
a lot less sticky than 'subscribe to channel through cable' just 'cause it's
three clicks. And then another three clicks if you want to re-subscribe.

------
Dynamicd
>Disney’s ownership of iconic franchises like Star Wars gives it something no
money can buy.

Didn't Disney buy Star Wars?

~~~
mruniverse
No money can buy anymore... unless of course they license or sell it outright.

------
kristianp
Sounds like Netflix needs to produce Blockbuster films, or buy Universal
Corp(the maker of Jurassic World, the only non-disney top film of the last 5
years). Universal's market cap is only 1.28B, about 10% of the amount Netflix
spent on content last year.

~~~
scarface74
Where did you get that number from?

Universal is owned by Comcast.

~~~
kristianp
I looked up Universal corp. Whoops, it seems Universal Corp isn't in the movie
business :
[https://en.wikipedia.org/wiki/Universal_Corporation](https://en.wikipedia.org/wiki/Universal_Corporation)

------
xbmcuser
Netflix has been targeting niche areas for the last few years. With most of
the larger markets now having local shows in their own language or foreign
shows with subs that have been appreciated a lot. I personally have watched
French, Spanish, Korean, Japanese, Chinese, Brazil content and probably use it
more for these language shows than I do for English shows. The advances in
machine translation text to audio and video morphing makes me wonder if we
5-10 years down the line we will get content modified automatically so that
translated dialog audio matches morphed video lip movement.

~~~
Freak_NL
Ugh, that sounds horrible. Instead of getting to enjoy regional differences
and different languages (subtitled if desired), every show would end up the
same for your locale, down to the local brands shown as product placements.

And why stop there? The actor drinks soda from a green can, and if you watch
the show now it will mostly be a can of Pepsi cola. But watch the show between
January and April 2020 from Canada, and you will see the new maple syrup
flavoured Dr Pepper instead.

~~~
xbmcuser
I didn't say I wanted it to happen. I personally got into movies as 10-11 year
old watching Jackie Chan and other Asian kungfu movies with subs. So watching
movies with subs is natural for me for many others it is not so and trying to
read subs while watching might not be fun. As long as I have the choice to
watch in the original language with subs I really don't care.

------
Jaruzel
Personally I don't see the problem with having my content on physical media,
such as Blu-Ray or UHD discs. Once I've bought it, it's mine, and no-one can
take it away from me. I'll still be watching my favourite movies over and over
again for years to come for a one time cost, and I don't have to worry about
the streaming provider removing it from their platform.

I know I'm in a minority though, and at some point in the next decade,
streaming services will be the ONLY place content is released, and the concept
of owning physical media will be considered archaic.

------
azdacha
I don't necessarily disagree with the statement that Netflix is not the new
TV. However I clearly see them in a position alike to a big TV channel. Disney
would just be another player as it's content would simply be different.

Still, I hope Netflix keeps Disney off their ground as I would prefer them
competing against one another rather than seeing it replaced or bought up.

Netflix has been doing grandiose work be it in their shows or even their open-
source work.

------
londons_explore
I don't believe Disney has the technical skill to make a decent cross platform
streaming app work right away.

There will be months of buffering and bugs, and that will mean they won't get
many customers. After 6 months of that, the IP will be forgotten by regular
punters. If content isn't watched and talked about in schools/offices/at
home/in memes, people forget fast. Disney's whole catalogue will get devalued.

~~~
scarface74
Disney owns BAMTech the same company that rescued HBO’s streaming service and
that’s used by MLB@Bat.

They also have a controlling interest in Hulu.

~~~
basch
Right? They literally went out and bought one of the best streaming tech
companies, years ago, to prepare for this. People are acting like Disney is
just starting this project today.

------
golergka
> In a world where you can watch practically anything whenever you want,
> dominance in distribution is very fragile.

That sounds exactly like the arguments against Uber to me: that these
companies indeed have changed our day-to-day lives, but their innovations are
in no way exclusive and users will easily switch between providers, quickly
reacting to changes in quality of service (ride cost for Uber and Office and
Friends being on Netflix).

------
SmellyGeekBoy
I, too, look forward to the day that 100% of our entertainment is controlled
by this American mega-corporation.

~~~
berbec
You mean today and every day for the last X years?

------
petraeus
Not many people are going to subscribe to a service to watch the same movies
over and over again. DIS+ is dead int he water unless it somehow creates
exclusive novel new content, which it wont just for its service, ergo DOA

~~~
tmottabr
you clearly do not have kids..

My 5 year old boy will watch the same film again and again for days until he
get bored and move to watching the next same movie for days, rinse and repeat.

my brother is 29 now but did the same thing when he was at that age, i still
know most lines from lion king by hearth because of that.

i have a friend that watch braveheart at least once a year.

i myself, there are many movies that i would rewatch every once in a while,
many from disney.

so it is not even a new or uncommon behavior that people watch the same movies
again and again.

also, disney already announced several series just for this service from
marvel (wanda and vision, winter soldier and falcon, loki) and star wars
(mandalorian, a new clone war season), so yes they will have exclusive novel
new content made just for it in there.

also, once it goes live all new movies from disney, marvel and star wars will
only be available there.

so it is definitely not dead in the water.

------
Phillipharryt
There's a saying in investing, "Don't bet against the mouse". And to anyone
doubting Disney being able to take over streaming, I challenge you to bet
against him.

------
dkrich
What’s interesting to me about this debate is that everyone seems to view it
as a Disney is coming for Netflix story and not the other way around. But what
prevents Netflix from creating its own animation studio and producing its own
blockbuster films and distributing them in theaters? What about licensing
merchandise from its movies or television shows? It’s not all that clear to me
that consumers will pay a monthly fee to stream movies they’ve already seen.
In any case Netflix is so different than what Disney announced with Disney +
that the case put forth in the article seems very simplistic and lazy.

~~~
scarface74
Netflix is already getting in enough debt trying to keep up with competitors
with the only income being subscription revenue. How much debt do you think
they can take on?

Besides “creating blockbusters” isn’t easy. See all of the other studios who
are trying to create “shared universes”.

~~~
dkrich
Because capital is cheap right now so you have lots of investors around the
world with cash they are looking to get return on willing to lend it at
relatively low rates. Netflix is able to borrow at low rates while ratcheting
up the subscription price and adding millions of new paying customers every
quarter which is how they are fueling hypergrowth. The idea that they should
be cutting spending is completely antithetical to their long-term strategy.

There is going to be a critical mass, I don't know where it is but I suspect
its not far off, where enough subs around the world are paying a high enough
rate while the need to produce new shows will be capped to keep people on the
platform. Then you have a wheel where enormous amounts of cash is coming in
every month and a fixed amount of content is being output. That's the path to
profitability.

Then if the sub base and price point continues to rise, they have enough cash
to do other things like build theaters or produce blockbuster films. And
that's not even counting if they come up with additional ways to generate
revenue such as licensing.

~~~
scarface74
So if all it takes is money to make “Blockbuster films” then why isn’t anyone
else doing it besides mostly Disney?

Netflix has around 150 million subscribers and they charge less in developing
countries than the US. Their entire quarterly profit was $291 million last
quarter. To put that in perspective, that’s half the profit that Disney made
on Avengers Endgame alone and that’s not including merchandizing and home
video sells and rentals.

Disney doesn’t need to get into debt for content and by the time Endgame
reaches Disney+ it will have already made a larger profit probably than
Netflix makes in an entire year.

~~~
dkrich
Netflix made over $4.5 billion in revenue last quarter and has been
consistently growing it every year at insane rates. Disney? Not so much.

A blockbuster film costs hundreds of millions of dollars to make. How many
companies have the money and desire to play in that space? It's Disney's and a
couple of other studio's wheelhouse. Netflix is quickly reaching the scale to
compete there though and they have demonstrated the ability to hire away
talent from all the major studios and quickly put out content that viewers
demonstrably spend time watching.

It seems like half the bull case for Disney + is Endgame. How many people are
going to pull out their wallets to sign up for a subscription to stream a six-
month old movie that they've probably already seen if they're that excited
about it? Seems like a stretch to me.

~~~
scarface74
_Netflix made over $4.5 billion in revenue last quarter and has been
consistently growing it every year at insane rates. Disney? Not so much._

Disney’s revenue was three times that and they just added Fox.

Revenue means nothing without profit. Netflix’s total profit last quarter was
less than that of either one of Disney’s last three Marvel movies.

 _Netflix is quickly reaching the scale to compete there though and they have
demonstrated the ability to hire away talent from all the major studios and
quickly put out content that viewers demonstrably spend time watching._

It’s not about the _talent_. Both Black Panther and Captain Marvel were made
by unknown producers. Disney has multiple franchises that have been popular
for decades.

 _It seems like half the bull case for Disney + is Endgame. How many people
are going to pull out their wallets to sign up for a subscription to stream a
six-month old movie that they 've probably already seen if they're that
excited about it? Seems like a stretch to me._

People are still buying Disney movies from decades ago. Kids will watch the
same movie repeatedly. A lot of Disney movies are considered classics.

------
senthilnayagam
in India sports too is moving to streaming, hotstar gave a full page add today
bragging 18.6 million viewers simultaneously watched IPL cricket finals.

if Disney was this serious they should have launched their services when
Netflix announced original productions.

------
treelovinhippie
Torrents. Either the dumb rentier platform wars end in an open streaming
protocol standard, or we just stick with piracy. Capitalism is absurdly
inefficient.

~~~
realityking
Assuming we had an open streaming protocol standard and standard clients, how
would that solve the issue of competing streaming services all wanting their
own monthly fee and offering different content?

No one cares about the protocol and the client - people want their content.

~~~
treelovinhippie
The idea is to decouple the content from the platform. So one way you could do
it is have the content deployed to an open distributed file storage and
streaming protocol (IPFS or Holochain perhaps, blockchain will never scale).

Content creators upload it to this network and the content becomes a
standalone entity.

Platforms then have full open access to the content. The platforms compete on
the UX/UI and recommendation algorithm layers. Every platform will have access
to all content. But if Netflix provides the best viewing experience then
people will pay a monthly fee to use it.

Each time the content is streamed, the user (or platform) pays a microfee per
minute watched which goes directly back to the content creator.

Omitting quite a few technical details but you get the gist.

------
fmajid
Netflix is not the future of TV. It's the present.

------
ap3
$6.99 ?

I’ll sign up for both

