
Netflix Long Term View - _pius
http://ir.netflix.com/long-term-view.cfm
======
ctdonath
This is a huge shift for Netflix.

Until recently, the motivating impression was that Netflix just plain had
every movie out there (which its continuing DVD service kinda does). I
subscribed because it was a cheap replacement for buying anything I wanted to
see: they had everything I wanted and could want. My to-watch list was very
long, and I thought it would remain.

Now, studios and competitors are making that model untenable. Netflix can't
carry _everything_ because studios/distributors want an ever-larger cut of the
profits, and competitors are willing to pay for exclusivity. Suddenly, I find
large sections of my to-watch list disappearing off Netflix as contracts
expire and don't renew (the biggest blow was when "Toys" disappeared -
something old & obscure enough that I thought surely they'd manage to keep
_that_ license).

Netflix just pivoted.

They're no longer the long-promised "long tail" of movies, hosting all but the
latest & biggest (yeah, I'm willing to pay extra individually for those). They
just gave up on that model.

Now they're becoming a "channel" focused on hosting a curated collection,
including their own productions.

That's a big shift.

~~~
ericflo
It happened a long time ago, at least I became aware of this shift when an
exec from Netflix was quoted saying "The goal is to become HBO faster than HBO
can become us" [http://www.gq.com/entertainment/movies-and-
tv/201302/netflix...](http://www.gq.com/entertainment/movies-and-
tv/201302/netflix-founder-reed-hastings-house-of-cards-arrested-development)

~~~
joshuapants
And honestly, I think Netflix is most of the way there. HBO Go is a pain to
use, the tablet app won't let me output to a TV or monitor, and it is
frequently slow for me. I can't remember the last time I needed to wait for
Netflix to buffer, and it seems to happen constantly for HBO.

Netflix is solid on the technical side, and their original series (in my
opinion) eclipse what HBO currently offers. HBO has one show that really
interests me (Game of Thrones, of course) and Netflix has a handful (House of
Cards, Orange is the New Black, Bojack Horseman, hopefully with more new
interesting series on the way).

The only reason I'm even subscribed to HBO at this point is because Verizon
gave me a few months for free, and I'll be ditching it once that expires.

~~~
hnnewguy
> _and their original series (in my opinion) eclipse what HBO currently
> offers._

I realize it's your opinion, but...really?

HBO has a massive catalog of brilliant shows[1]. Netflix isn't even on the
same planet when it comes to original content (but I hope they get there,
better for all of us).

[1][http://en.wikipedia.org/wiki/List_of_programs_broadcast_by_H...](http://en.wikipedia.org/wiki/List_of_programs_broadcast_by_HBO)

~~~
wmeredith
Tis is my position as well. HBO has been putting out some of the best content
available for TV for over a decade. Their back catalog make HBO Go's nominal
cost seem like a pittance. Netflix has put together some quality original
content (House of Cards is outstanding), but they're going to have to keep it
up for a generation before they hold a candle to HBO.

~~~
geoelectric
I don't think so, because HBO's old content is already widely available. It's
only kind of good for retention, and that only on HBO Go (and Amazon, now that
it's there too).

The competition for new subscriptions and paying that one more month always
takes place in the present/future, or at least for content you haven't watched
yet which for any fan is going to be present/future.

And Netflix is kicking ass there, TBH. They have high-quality dramas,
resurrected cult (and my!) favorites, the deal with Marvel, and probably half
a dozen other things that got me salivating that I'm forgetting.

To be honest, I think Netflix, Amazon and Hulu are -all- schooling the old
school providers in terms of interesting new content, HBO included. I love Six
Feet Under, Mr. Show, and Deadwood as much as anyone, but aside from Silicon
Valley and GoT, nothing else current excites me. At the very least, HBO needs
to get much better at both making -and- fulfilling promises.

~~~
ulisesrmzroche
You're assuming fans only care about fresh content and have seen everything in
the past. Thats not true.

~~~
geoelectric
Sure. But then you come back to the fact that the majority of their old, good
content is carried on other services.

------
rogerbinns
Am I the only one who finds finding something on Netflix to watch increasingly
difficult, and contradictory to what they say in that piece. My experience is
mostly using Roku (a spinoff from Netflix) and Android.

For example if I watch a WWII documentary, then they feel the need to
recommend every one they have, for a long time. Oh and "watch" means "seen
more than a second or two of", so you get all this crud even if you didn't
like it.

Perhaps the biggest sin is showing me stuff I have already watched, outside of
the "watch again section". My home screen is mostly things I have seen, and I
have to keep scrolling past to see if there is anything interesting deeper in
the sections.

It is especially annoying that there is no "do not show this again". My home
screen is a collection of content I have already seen, or do not want to see.
It makes Netflix look dumb and is very user hostile.

Most amusing is that they don't provide a way of finding content that you want
to watch now. For example you would like to watch something funny and light
for the next half hour, or a date night movie. Sometimes those categories
randomly show up on the screen, but usually not.

I'd go on, but the overall vibe is a very dumb experience of recommendations
that I don't want, no useful content exploration, and it feels like I watch
stuff despite them, rather than because of them. Maybe I should cancel my
account again.

~~~
geoelectric
I'm not a fan of their suggestion interface either, but InstantWatcher and
CanIstream.it go a long way towards fixing that.

But...Roku, a spinoff? Nope. Roku's independent, founded by the guy who
founded ReplayTV, which was TiVo's only real competition way back when.

~~~
rogerbinns
You'll need to correct all the people who wrote about Roku being a Netflix
spinoff then. Here are some to start with:

[http://www.fastcompany.com/3004709/inside-netflixs-
project-g...](http://www.fastcompany.com/3004709/inside-netflixs-project-
griffin-forgotten-history-roku-under-reed-hastings)

[http://venturebeat.com/2013/01/23/netflix-created-
roku/](http://venturebeat.com/2013/01/23/netflix-created-roku/)

[http://techcrunch.com/2013/01/23/before-the-launch-of-
netfli...](http://techcrunch.com/2013/01/23/before-the-launch-of-netflix-spin-
off-roku-ceo-reed-hastings-decided-it-would-be-cute-to-make-fun-of-foxconn-
assembly-line-workers/)

~~~
geoelectric
Thanks for the correction! I missed that chapter somehow.

------
solutionyogi
_Winning moments of truth_

We strive to win more of our members’ “moments of truth”.

Those decision points are, say, at 7:15 pm when a member wants to relax, enjoy
a shared experience with friends and family, or is bored.

They could play a video game, surf the web, read a magazine, channel surf
their MVPD/DVR system, buy a pay-per-view movie, put on a DVD, use a piracy
service, turn on Hulu, or launch Netflix.

We want our members to choose Netflix in these moments of truth.

\---------------------------------------------------

This nails it. When I get home (especially if I had a long day at work), I
first go to Netflix and see what's on my list. This is because Netflix app is
beautiful, it always works and they have my list of things to watch. As
someone who loves to watch documentaries, I am happy with the selection that
Netflix offers.

If I don't like anything on the list, I just watch an old Friends or Breaking
Bad episode.

I think Netflix has absolutely nailed the user experience and depending on
your taste/location, their selection is great as well.

~~~
anatari
Although I use Netflix all the time, it's in spite of their app. Outside of
the "my list" I've curated myself, 98% of the things the Netflix app shows me,
I'm not really interested in. I feel like that ratio could easily be made
better if they allowed me to mark things I'm not interested in and never show
me those things again + apply machine learning to display a better
personalized catalog.

Whenever I use Netflix I always feel like there is a lot of content locked
away and I have to dig past the same stuff it always shows to find stuff I'm
interested in.

~~~
tomsthumb
> ... if they allowed me to mark things I'm not interested in and never show
> me those things again

You can literally do exactly that. If you hover over a title there should be a
button that says "Not Interested". It should appear just below the stars as if
you were going to provide a rating.

~~~
humanrebar
I primarily interact with Netflix through my game console. 'Not Interested' is
not an option in that UI.

------
jader201
Maybe it's just me. But one thing about linear (live) broadcasts -- and this
also applies to an extent to live radio vs. mp3's -- is that there is just
something engaging about watching a program that you know other people, at
that moment, are also watching.

It's also missed when watching a show that you DVR'ed, after the fact -- like
the series finale to Lost, or the Super Bowl.

If/when live broadcasts are completely a thing of the past, I think this sense
of engagement will be lost forever, and people won't even realize what they're
missing out on.

In a way, it's sort of like watching someone play a video game live on Twitch
vs. watching it on Youtube.

Does anyone else know and also feel this sense I'm talking about?

~~~
lukifer
I experience this phenomenon on a less immediate time scale: in the days
following a new episode of Breaking Bad, etc, there is discussion and
camaraderie with other fans. With the "binge-only" model of House of Cards,
that same social experience is not possible.

~~~
slig
> With the "binge-only" model of House of Cards, that same social experience
> is not possible.

Maybe that's why they're releasing just one episode/week of their new TV
series "Better Call Saul".

~~~
ColinCochrane
I think that's because Better Call Saul is originally broadcast on AMC, which
airs it weekly.

------
donpdonp
This is a great write-up and a wonderful precedent for netflix to set. That
being said, I feel the post is mostly promises, as Netflix is in the middle of
another year-long 'content desert'. I cant remember the last time I got
excited about The Matrix or Iron Man coming back into the queue.

My process is to check
[http://instantwatcher.com/](http://instantwatcher.com/) and then go to
netflix. The thing is I've been disappointed by whats at the top of the charts
for so long, I've considered dropping netflix. The top 50 is uninteresting
sounding documentaries, low budget horror, and everything else that rounds out
the discount DVD bin at the grocery store. Netflix excells at one thing -
Television.

I get that its likely not Netflix's fault. The cut for movie studios each
month from an $8 subscription cant be very much. I feel Amazon's pay-to-play
model is more realistic, though less consumer friendly. I remember the deal
announced last year of netflix getting first run Disney flicks (starting in
2015 I think?) and thats exiting, but the daily reality of netflix besides TV
is the entertainment equivalent of hot, soupy gruel.

~~~
GrinningFool
I don't see Amazon's model as less consumer-friendly - particularly as I
remember well the days of having to go to the local video rental place, making
sure to return it on time, paying late fees, etc.

I'm happy to pay $3-5 for a few days in which to watch a movie, and then not
think about it when I'm done. The price is right, and the convenience can't be
beaten.

~~~
chc
You could buy a lot of movies outright for only a bit more than Amazon
charges, so the price seems a bit steep to me. Obviously not back-breaking,
but the price feels wrong.

~~~
jacobr1
I've never understood buying a movie, though. Once I've seen it, I'm done. No
need to ever see it again. One of the best things about Amazon's service is
the hybrid model. Prime for tons of content and when that fails you can rent a
la carte. While everyone is fighting the content purchasing wars this seems to
give the consumer the most content albeit with inconsistent total pricing.

------
mc32
One of the things they bring up, which is that apps are replacing channels,
annoys me. I'd rather do a global search and then present me with delivery
media (channels/apps/whatever) instead of having to pick the app and then do
individual searches. It's a pain point.

Also, if they want to capture the hotel market, I mean people on the road
staying in temp accommodation, they'll have to deliver blue content (or yellow
as they say in Asia). People on the road want pornographic content, more so
than at home. Their current most likely option is to get it at high markup via
hotel operator delivery systems.

~~~
JohnTHaller
This is one of the things Roku gets right compared to other set top boxes. You
can search across services. Unlike on other boxes like Amazon's which lets you
search Amazon and will always push their content above anyone else's. It's
especially annoying if something is available on Netflix and is paid content
on Amazon... it's still going to tell you to buy it on Amazon even when you
already have access to it for no additional cost.

~~~
wmeredith
It's a platform seller, too. I've had an Apple TV, Fire TV, Fire Stick,
Playstation 4, and a Roku box. This singular feature is the reason why we
watch TV and movies on the Roku box more than anything else. It's like magic.

------
sandworm
My family uses netflix. I don't. Every time I want to watch something I cannot
find it. 10,000 titles is nothing in a world where The Simpsons has several
hundred. Netflix needs more and deeper content.

I won't admit to ever downloading something without full written permission of
the copyright holder, carved in stone and witnessed by three saints, but last
night I did watch "Black Books" after not finding it on Netflix or any other
service.

(If you are a fan of 'Father Ted' or 'The IT Crowd', Black Books was done by
the same people and contains many of the same jokes.)

~~~
joshuapants
The biggest issue with content is that rights-holders either don't want their
programs on Netflix or they don't think they'll be paid enough. I think
Netflix is in a sweet spot on pricing (if the charge substantially more,
people may be more inclined to stop subscribing) so paying more to attract the
heel-draggers may mot be an option.

That's part of the reason why they're making their own series. Eventually
rights-holders won't have much choice but to allow streaming, but for the
immediate future they're the bottleneck.

~~~
rhino369
IP holders have pretty much embraced streaming. They have not embraced
Netflix's price point. And at 8 bucks a month, I don't think it is reasonable
to expect them too. I don't think 8 bucks is enough revenue to be a major
source of funding all the content that is produced.

Netflix has been essentially freeriding on cinema goers and live tv watchers
who subsidize all the content creation. If Netflix replaces those sources,
it'll have to provide similar revenue.

~~~
vasilipupkin
exactly. Why don't they have a full catalog of everything out there and let me
pay 5 bucks for a particular movie I want to watch?

------
yazaddaruvala
If someone from Netflix is reading:

> We win those moments of truth when members expect Netflix to be more
> pleasurable than their other options

Can you please make it easier for me to find my "Recently Watched" TV Shows?
That would definitely make my experience "more pleasurable".

Also, please stop showing me movies I've already rated. I've seen those. Just
show those to me in the "watch again" list.

Platform: Website

~~~
jaredsohn
Just click on "Recently Watched" at the top left of the homepage.

It links to here:
[https://www.netflix.com/WiViewingActivity](https://www.netflix.com/WiViewingActivity)

~~~
yazaddaruvala
So for me that page is broken. It reads "My Activity" and then its just a grey
page.

~~~
jaredsohn
Some ideas:

* Check for Netflix extensions and disable them in case they are breaking the page.

* Turn off "Test participation" in Your Account

* Open the console and see if there are any error messages.

* Contact Netflix Support (there is a link from Your Account and when I've tried it I have gotten a response right away.)

Normally, for me the page looks very similar to
[https://www.netflix.com/MoviesYouveSeen](https://www.netflix.com/MoviesYouveSeen)
(and is linked to from there.)

------
spike021
I personally don't really like the setup Netflix uses as much UI-wise. It
seems as though nowadays services need to be all about personalization, where
ratings, reviews, and content watched all factor into the new content that is
shown to me, the user. I might only like one movie or tv show of a particular
genre, give it 4 or 5 stars, and then there's a pretty good chance I'll keep
being shown similar ones that I know I'll never be interested in watching.

For myself, I think it would work really well if they had the more standard
list of available shows, movies, etc in alphabetical order, or some other more
sortable format, perhaps by release/airing year, or similar.

~~~
jaredsohn
They have a lot of this, at least if you are accessing the service via the
web. Just click on Browse and choose a genre and you'll be able to sort by
rating, year of release, maturity rating, or alphabetical order. You can also
access these genres by clicking on the section titles in the recommendations.

Otherwise, your best bet is to use one of the many external sites such as
allflicks.net.

~~~
spike021
Oh... I guess I missed that via the website. AFAIK that's not available for
other clients, but I could be wrong actually. It still seems that they want to
have personalized lists front and center, when it would be nice if they would
have a setting that lets a user choose what is displayed at the root level.
But otherwise that does seem to work pretty well.

Thanks for the tip.

------
drawkbox
_Eventually, as linear TV is viewed less, the spectrum it now uses on cable,
fiber, and over-the-air will be reallocated to expand Internet data
transmission. Satellite TV subscribers will be fewer and more rural. The value
of high-speed Internet will increase._

This is something that has always bothered me, internet bandwidth only takes
up a small amount of spectrum in place of channels and the cable companies
could cut lots of channels and improve broadband dramatically. The days of
someone dictating what you watch and at what time are over, why all the
spectrum hoarding.

Even when I got my first broadband cable connection, one of the first on the
node in Chandler in 1996, the cable guy said it only used the space of 2
channels for internet data and the rest for broadcast/cable channels.

~~~
__david__
My cable company dynamically allocates the bandwidth on the last mile cable so
that it only broadcasts what people are currently watching. This ostensibly
lets them show much higher bandwidth HD shows and have more channels available
than they actually have bandwidth for.

So in this particular case, it's not as wasted as it could be. I even think
this might be why they were recently able to bump up all the internet speeds
in my area.

------
arianvanp
Must be hard for netflix sometimes.

Here in The Netherlands for the past 5 months only Lord of the Rings part 1
and part 3 have been available due to licensing issues or something. I've
called customer support a few times and they keep saying " We're working on
it. but we have issues obtaining the license". Seriously. How can a studio
only license Part one and three? This stuff makes me mad.

Contacted customer support for the last time today and the person I talked to
once again told me the same thing but then surprisingly started openly ranting
about "How te studios can be such a pain when we ask them to renew licenses.
And that it's diffucult not to get in trouble with them".

Anyhow. they'll personally contact me once they have fixed the license again.
That's some nice customer support right there.

Quite saddening to see studios stand in the way of a solid product. I just
want to watch my darn triology on friday evening.

~~~
dragonwriter
> How can a studio only license Part one and three?

They probably have licensed all three parts for streaming, but perhaps, in
your region, someone paid for an _exclusive_ license on the second part that
hasn't expired, so Netflix isn't able to get a license.

------
ForHackernews
> As we’ve gained experience, we’ve found that the 20th documentary about
> bicycling will mostly just take away viewing from the other 19 such docs,
> and instead of trying to have everything, we should strive to have the best
> in each category. As such, we are actively curating our service rather than
> carrying as many titles as we can.

This sounds like a bad move to me. Maybe carrying a huge breadth of content is
a good way to attract new users, but unless they have _depth_ of content, they
aren't going to hold onto those users. Most people aren't that eclectic in
their tastes, so if you only have one film in each category (even if it's the
"best" one) people are going to drop them after they've watched everything
they like.

Put another way, bicycling-documentary fanatics aren't going to keep paying
$8/month indefinitely for access to one great biking doc.

------
vasilipupkin
What confuses me is this: Why doesn't Netflix allow me to pay a little bit
more, as an option, and, in exchange, have every single movie available to
watch online? I mean, sure, they can produce their own shows, but only some of
them will be good. So why limit content so much? I pretty much stopped using
Netflix, instead I go to Amazon Instant Video

I may be missing something, but strategy of producing original content, while
limiting the catalog, doesn't make sense. Why not have infinitely large online
catalog AND produce original shows?

~~~
dragonwriter
> What confuses me is this: Why doesn't Netflix allow me to pay a little bit
> more, as an option, and, in exchange, have every single movie available to
> watch online?

Because much of the content they don't have is because the content owner is
competing with Netflix and won't license it, or because some other Netflix
competitor has purchased an exclusive license.

Some of it is Netflix managing in-total licensing costs, which could be
addressed by having "premium" content (either as a tier or pay-per-title or
pay-per-view), but that's not the case in general.

> Why not have infinitely large online catalog

Netflix's former, deeper catalog was only possible because content owners were
less aggressive in attempting to capture all the value of online streaming of
their property.

~~~
vasilipupkin
are you talking about Amazon Instant Video when you say competitor?

------
danso
OK, a little OT and minuscule, but kind of gels with in with Netflix's overall
future...has anyone else noticed that Netflix's predicted ratings seem to be a
bit inflated, since perhaps last year? For previous years, I could count the
number with one hand of movies/TV-shows that Netflix rated more than a 4-star
for me...now there are dozens and dozens of things that Netflix thinks I would
give a perfect rating to.

Maybe it's because I've become less discerning or have unconsciously changed
in the way I rate things...but I don't think so...it used to be that anything
predicted to be 4-stars or above --which was very rare -- was indeed something
that I would love. Now I'm seeing many preemptive 4.8 to 5-star ratings for
things that I _know_ I don't like (because I've seen them before).

(I think we can agree that the effect of seeing more high-rated content is not
the result of Netflix actually getting more quality content...the number of
good movies has remained constant or gone down, especially since the Starz
day)

The cynical user in me thinks Netflix has tweaked its algorithm to encourage
me to watch more things. However, at least they don't seem to have tweaked it
in favor of their exclusive content, as none of those (such as Marco Polo) are
predicted to rate highly with me.

~~~
codewell
dvd.netflix.com seems to still use the old reliable ratings predictor.
Downloading (netflix.com) uses a much inflated predictor that seems designed
to push popular stuff. I imagine they have to do this to obscure that the
selection is so much poorer for download.

------
mxfh
Can someone tell me how geo-fencing within the EU is still a thing to stay
when one of the EU's main digital agenda goals is to establish a digital
single market market?

[https://ec.europa.eu/digital-agenda/en/our-goals/pillar-i-
di...](https://ec.europa.eu/digital-agenda/en/our-goals/pillar-i-digital-
single-market)

[Edit] Some sources:

Geographical Restrictions, (and different pricing) for digital goods within
the EU are clearly discriminatory against the customer. As stated here:

[http://www.europarl.europa.eu/meetdocs/2014_2019/documents/i...](http://www.europarl.europa.eu/meetdocs/2014_2019/documents/imco/dv/ppt_descrimination_consumers_/ppt_descrimination_consumers_en.pdf)

 _Under intellectual property law, right holders may geographically restrict
licenses. Therefore intellectual property law allows businesses to
compartmentalise the market. Restrictions of passive sale are contrary to the
consumers’ freedom of access to goods and services on the DSM, and are not
permitted under European law.

Prohibiting geographical restrictions would not require fundamental changes to
the international system of intellectual property rights. It would simply
ensure that all licences granted for the territory of one Member State are
valid for the whole territory of the EU. The tendency to market
compartmentalisation is inherent to territorially restricted IP rights._

[http://www.europarl.europa.eu/RegData/etudes/etudes/join/201...](http://www.europarl.europa.eu/RegData/etudes/etudes/join/2013/507456/IPOL-
IMCO_ET\(2013\)507456_EN.pdf)

~~~
Atropos
The EU's competition authority has actually launched an antitrust
investigation into this in January 2014: [http://europa.eu/rapid/press-
release_IP-14-15_en.htm](http://europa.eu/rapid/press-release_IP-14-15_en.htm)

It's a really complicated issue though, but hopefully, geo-restrictions will
vanish at some point in the EU, either by legal or political force.

------
ebbv
> As such, we are actively curating our service rather than carrying as many
> titles as we can.

I hope this is true. Because the quality of content that has been added to
Netflix over the past year has mostly been god awful. A lot of the movies that
have been added are not even D-grade quality. They are straight to video
dreck.

On top of the bad movies there's been reams and reams of awful reality shows
as well.

When I first signed up for Netflix they had full libraries of HBO and Showtime
shows. NBC shows. Movies that people actually went to see in theaters.

I understand that having HBO and Showtime's libraries is going to be hard now
that those companies are pursuing their own subscription services. But that
doesn't mean Netflix needs to resort to the crap it's been adding lately.

Honestly, if things don't improve in 2015 there's a good chance I'll cancel my
Netflix subscription.

------
guiomie
"we should strive to have the best in each category" ... this is certainly not
happening in Canada.

~~~
jaddison
Agreed, but this is true in any of their countries. Content licensing really
gets in their way.

------
throwaway420
Netflix employs many smarter business people than me that operate with a lot
more information, so my opinion may be completely incorrect, but I've always
thought that they erred by being scared off of the criticism they got when
they increased their pricing a tiny bit. Less than ten dollars a month is an
incredible bargain for the vast number of hours of content that they provide.
Netflix should double, triple, or quadruple their price and get themselves in
financial position to meet the demands of all of the studios going forward for
all of their content.

You can't do that if you're pricing yourself out of that game though. I want
to pay Netflix more money for a catalog that has virtually every movie/tv show
ever. But that's just me.

------
zanny
Just a tangent, but the 600m for advertising and 500m for product development
is not a Netflix only thing, but it always pisses me off so much to read it.

That first number, the bigger number, is a black hole. Advertising is the
worst, with its only competitor in my book being the legal system, industry in
the industrialized world. It produces nothing of value, because all it tries
to do it move money from predisposed destinations to the advertisers. It is
buying market share, without making anything with the money. The later is
actual productivity, goods and services people can use and want and experience
and benefit from.

I'd go into another tangent about how advertisings size is out of control and
it only gets worse due to how people are getting poorer on average (less money
per individual) while wealth concentrates in the rich (ie, those that would
own a company like Netflix) which means that when you rake in huge profits and
a big money pot, what do you spend it on? Making goods and services is
pointless if there is no money left in the market to explore your products and
buy new things. Instead you throw those profits into advertising, into a non-
productive discipline whose only job is to manipulate people into giving you
money they would have spent elsewhere. But this post is already long enough
that nobody is going to read it anyway!

What a colossal waste, everywhere advertising happens. And it is only on track
to get worse.

~~~
punee
> It is buying market share, without making anything with the money.

Erm. Yes, it's doing something with the money. Buying market share.

------
schnevets
I wonder if Netflix is preparing to offer services to studios/businesses as a
contingency plan. Their infrastructure seems to be amazing, especially
compared to the bug-riddled Hulus and Crackles of the world. I don't have
cable, so I'm not sure how it compares to HBO Go and other studio-centric
sites, but it can't be easy to maintain those kinds of services. Maybe we'll
see a future where studios leverage Netflix's cloud, but offer their own
distribution/revenue schemes?

------
bluebook
This was interesting positioning from Netflix: We don’t and can’t compete on
breadth of entertainment with Comcast, Sky, Amazon, Apple, Microsoft, Sony, or
Google. For us to be hugely successful we have to be a focused passion brand.
Starbucks, not 7-Eleven. Southwest, not United. HBO, not Dish.

Netflix is phasing out its DVD business over the next couple of years to focus
on domestic and international streaming. International is where penetration is
pretty low and they're targeting 15-16% penetration of broadband households
over five years from its current 3%.

In the last few quarters they've outperformed their own subscriber growth
forecasts on the international side with country launches in France, Germany
underway. The share price has jumped each time. Other markets they are likely
to cover Italy, Spain, OZ & NZ. Massive markets like India, China, Russia and
Japan really unlikely for the medium term at least with piracy, strong local
incumbents and lower purchasing power.

It's just made $270m in profits in December 2014, after 10 years of losses
from IPO to 2012 and secured a $500m loan with $1.1 billion cash so it is only
now becoming financially sustainable. I assume they are getting better at
creating own original content and thought Marco Polo was pretty good, might be
on my own there though. I think the future is bright though opening in each
new country and having to license content in them way in advance means lots of
upfront costs in unfamilar locations. Should be a long slog but they're on the
right track as a focused, passion brand.

------
Malic
"long-term-view.cfm"!? Cold Fusion? That's still a thing?!

~~~
tshtf
If you do a dig on ir.netflix.com, you'll see this is hosted at
shareholder.com. It is not uncommon for publicly traded companies to host this
stuff through third-party providers.

------
kriro
Interesting read. I think they are slightly underestimating Amazon as a
competitor. They mention them but from my point of view the edge that Netflix
has is good engineering (including usability) and being attractive to good
engineers. A somewhat random small, recent example is the fact that they were
at reactconf, talking about interesting stuff (targeting non-DOM) and showing
involvement in "hot" technology.

That's an edge that HBO has a really hard time catching up to but Amazon
doesn't. I think Netflix is putting a bit too much focus on the content side.
It also reads a bit like they'll shift a bit more from customer to business
partner focus which may or may not be a good idea.

------
Yen
The thing I find most interesting is their strategic take on piracy - they
recognize it as a competitor. When a 'moment of truth' rolls around, it's an
option potential customers might choose, depending on content available and
user experience.

They dive into detail on the 'competitors-for-content' category, with whom
they could compete both on the available content and user experience fronts.
On the other hand, the only advantage they can eke out over piracy is in the
user experience.

------
cheriot
I'm building lazyfan[1] precisely because of how fragmented availability has
become. Even when you want to pay to stream a specific movie, it might be
available from iTunes, but not Amazon or vice versa. But you don't want to pay
for something you have so you have to check Netflix or Amazon Prime.

Forget comparison shopping, it's tough to even know what's for sale.

[1] [http://www.lazyfan.com](http://www.lazyfan.com) (beta)(a movie trailer
autoplays)

------
Poiesis
Given their example scenario ("moment of truth"), I'm far more likely to just
buy an episode of something for a few bucks on iTunes. That way I have a much
better chance of finding what I'm looking for, and I can watch something
current if I want.

I'd prefer a subscription, and I don't really care to _own_ a random episode,
but if I was watching so many shows that the money would be an issue, I would
have a cable subscription (I don't).

------
Shivetya
I am amazed at the dollar amounts the give. I never expected it to so much to
market such a service. The technology side I could see, expanding their reach
and such.

~~~
joshuapants
Shooting a commercial can cost a million bucks. If you want prime advertising
slots, it might cost from a few hundred grand up to a million for a 30 second
spot. Print and online advertising is cheaper, of course, but I don't think
their advertising budget is unreasonable considering how large a company they
are and how difficult it may be to get new subscribers.

------
4ydx
Man this transition feels like it is going to take my lifetime. Years ago it
felt like an internet based on demand (+cheap) option should have been
available. It is a simple thing to fantasize about but a difficult thing to
realize it seems. For me personally the price point still feels too high given
that I never get to own any content.

------
dude_abides
My attempt at a tl;dr:

We cannot afford to license all content from all studios (and compete with
Comcast/AT&T etc), so instead we will spend 5b trying to create our own
content (and compete with HBO instead).

Oh and we will be spending half a billion on marketing.

(did I misread)

~~~
kolev
Time to bid a farewell and switch my mindset to Google Play, Vudu, and Amazon
Instant Videos. I get less bang for my bucks with Netflix and I'm not into TV
shows to justify with their "original" stuff. Why do they want to get into
this game when all HBO needs is to open HBO Go to everybody for $7.99/mo?

------
merrua
Netflix europe has terrible descriptions of the films/shows which you may as
well ignore. Also their catalog really isn't that impressive. It would be
rather easy to replace it if anyone tried.

------
princetontiger
I interviewed here, and it was by far among some of the best group of people
I've ever met.

I think some of the HR people are a bit rough, but the teams that contribute
to the bottom line are top notch.

------
Igglyboo
I wonder when they are going to close down their DVD division.

~~~
Animats
Since the online catalog started shrinking, the DVD division is more useful.
The DVD rental business has first-sale-doctrine rights; Netflix can rent those
DVDs even if the studio doesn't like it. They don't have that right online,
and have to cut a deal each title.

~~~
Igglyboo
Yes but are people still using it? Personally I don't really care how big of a
catalog they have, I'm not going to wait 2-3 days for a movie to arrive.

~~~
Thrymr
Yes. I like movies, and a service that only has a limited selection of crappy
movies isn't that interesting to me. I don't really care if it takes a couple
days to arrive. I can see the attraction of the streaming service if you are
into the TV series that they have, but it's not even a competitor for movies.
I would love to sign up for a full catalog streaming service, but it looks
like that will never happen.

------
yalogin
Why are people raving about this? It has no new information and sounds like a
marketing release. What am I missing?

------
forrestthewoods
I wonder how long until they stop their DVD shipping side business.

------
throwaway150219
So, what is happening faster:

1) Deployment of AFFORDABLE highspeed broadband

or

2) Decreasing local storage costs

Why do I need to stream something if I can store 6TB of data locally for less
than $150 (and decreasing daily).

How much storage space will $200 buy you in 10 years? And how many decades of
video and audio could one store on such a device?

~~~
tempestn
You still have to get that content from somewhere. Storage space isn't really
the limitation there. Plus, even if you could, what would be the motivationto
store eeverything locally, when 1) you rarely watch a show more than once, and
2) you can stream it instantaneously anyway?

~~~
DennisP
Maybe you have better internet than me, but my streaming quality isn't always
HD, and if I fastforward/rewind I generally have to wait a while to rebuffer.
Do an advance download of everything in my watchlist, and the next episodes of
the series I'm watching, and everything will by high quality, no wait, all the
time.

Besides that, just because something's available on streaming doesn't mean
it'll stay there forever.

------
Touche
Can someone tldr; this?

