When Netflix first started, they were able to buy the streaming rights to old movies and TV shows for cheap, because executives thought they weren't worth anything. Now those contracts are expiring, and the studios want to jack up the rates or start their own service.
Netflix is also getting squeezed by ISPs like Comcast, who want to charge them for the right to deliver video to Comcast's customers who already paid for their bandwidth.
So Netflix' only way to survive is to develop its own content. If it's dependent on other people to provide content, they'll jack up their prices to take Netflix' profit margins.
So now you have 5-10 competing services, and if you aren't paying attention, you don't know what shows are available on what service. Meanwhile, if you go to a file-sharing website, you can get every single show and movie. So Netflix (and its competitors) have less compelling of a value proposition, if you have to pay $10/month to several different services to get all the shows you might want to watch.
Speaking of exclusive content, I highly highly recommend Netflix's "Daredevil" (a TV series they developed with Marvel). It's seriously some amazing content.
I've only watched a handful of their shows, but I'm yet to watch a Netflix show that isn't great. House of Cards is fantastic, Daredevil as you say is amazing, Bojack Horseman is hilarious, and Unbreakable Kimmy Schmidt is a breath of fresh air.
season 3 of house of cards is trash imo. The rest was brilliant, and it hurts. I went from watching characters with an actual goal struggling and overcoming obstacles to meet that goal to watching a soap opera.
It was definitely the weakest season, but I think it mostly showed because season 1 and 2 were so good. I've still got high hopes for next season given how season 3 ended.
I don't want to spoil anything so I'll be vague. The problem is that the main character went from being a conniving underdog to the top of the stack way too quickly. Now the stakes are much lower because he already got what he wanted, and it's much less interesting to watch.
If you look at the British series, it's much shorter, and for good reason.
I feel like they butchered the character by making him 'angsty', and I personally hated the way the 3rd season ended. It exemplified everything I disliked about the 3rd season.
The opening scene for the season 1 had me hooked. They defined that character so well with that opening scene and I was immediately interested to see what this character was willing to do.
Then season 3 happened and I find he's turned into every other character in every other modern show.
I wish they had taken the approach of just making him ruthless towards the other nations in achieving the US's goals instead of the direction they went in.
They went beyond updating and Americanizing the British show, and ended up with contrived drama and bad Putin impersonation. Writing a good show is hard!
Daredevil is fine, but it certainly isn't good enough to sell Netflix to me. Netflix with only Netflix shows isn't something I'd pay $10 a month for unless they seriously up their game. HBO is the baseline they have to match, not a goal they should hope to reach for.
Bloodline is absolutely fantastic, I've been recommending it to all my friends. I can't praise it enough - also glad there's a second season coming in 2016. Apparently the creators (KZK) have a 6-season arc planned...
I'm almost finished with the first season and had to force myself to go to bed at like 1am because I wanted to keep watching more.
It's not quite "Breaking Bad" levels of tension and machination but it's a good, slow burn that really picks up as it moves along. Doesn't hurt that I just got back from my first visit to the Keys right as this came out.
Seconded. The fight choreography and photography are as good or better than John Wick if you're into that sort of thing. That hallway fight scene was amazingly well done. The casting is quite good too. (Although the actor could learn a couple of things from Chris Gorham, who did a really great job of playing a blind guy on Covert Affairs.)
Thirded. Another thing that sets it apart from other superhero shows is that how, after a while, the series spends time showing the main villain, who gains a human dimension.
I've really found the writing to be mediocre. The storyline is compelling and the direction has done a great job with cultivating that sort of hero emotion porn we've been seeing develop in the industry the last generation. But the dialog, man, it just kills it for me.
Daredevil is no doubt good but I wouldn't put it in the same league as HoC, as another commenter did. They could definitely go darker (though I couldn't say how, at the moment), take out the silly banter and little jokes mostly coming from or involving the long-haired lawyer.
Doesn't the light moments make the dark ones even darker, though? Or maybe that's it, that a story that's only dark seems a little silly and therefore safe, while a story that's both everyday light and really really dark becomes more unsettling because it can fit into the real world in a way?
I don't understand why people forget they have the DVD business. That's why I subscribed, and I've always been a subscriber. Everything comes out on DVD eventually, so you can watch almost anything through Netflix if you're willing to wait. And there's plenty of media there to fill the time.
I guess what it often comes down to for me is that I don't really need a video rental store (online/shipping or brick and mortar) too often. For the one or two movies I consider "must see" each year, I go to the theater. For the ones that I still definitely want to check out later, there are on-demand streaming rentals that allow me to decide what to watch and have it there immediately.
Then as films get farther and farther from their release windows, they turn up on HBO or Netflix streaming, etc. It's just a smaller niche for me between wanting to see it at release and not caring when I get around to watching it.
Since Netflix added streaming it's essentially taken the place of basic cable for me (rather than replacing Blockbuster). With basic cable you can't always count on something being on at a given time but you can usually skim through the options and find something enjoyable. That's how I am with Netflix. The only difference is that Netflix costs $10/mo whereas basic cable costs $50+.
I like the fact that a company is managing to compete with cable networks without actually being a (traditional) cable network. Their shows may not always beat the best of HBO but they sure as hell beat USA, TBS, and the long list of "random shows and movies" cable channels.
Its still a good service and their ability to turn around disks so quickly was a huge advantage to them for years. They wisely realized, however, that the DVD business would die slowly and got very competitive about streaming. I'm sure you can enjoy the dvd mailing for at least a few more years before they begin closing those large warehouses down one by one.
I don't understand why people forget they have the DVD business.
Presumably because it is becoming a smaller and smaller part of their business. That's the reason they wanted to spin it off as Quikster. DVD rental also isn't available on the subscription package that most users have.
Don't forget the rather oppressive DRM required by Hollywood for 4K video content. This is why 4K is currently only available for Netflix original content.
It's optional, but most producers choose it despite the additional financial overhead, because otherwise it becomes much more expensive to audit which theaters played your movie and how often in order to get paid. Obviously it's not just theaters any more but they're most likely to have 4k gear, in terms of both display and fat pipes. 4k is basically the industry-standard output format* so if there's no DRM then downstream distributors have an enormous economic incentive to rip the originator off by serving up that very high-quality copy for the highest price they can get and pocketing all the ticket sales revenue for themselves.
Very basically, rental of a film for a cinema for a day is $250 or 35% of ticket sales, whichever is more (the flat rate is less over long periods, the 35% stays the same). 2 hours of 4k UHD video in the ProRes codec (which will play back smoothly on a regular computer, with good enough quality that most people wouldn't notice the difference) is about 700gb. A fast 1tb drive in an enclosure is under $200, so if the film is even moderately popular and would benefit from being presented on a large screen (which most films of any quality certainly do), then it becomes very tempting for exhibitors to make a copy, either for display or to produce knockoffs in disc form (which will be fully competitive with the 'official' version as far as audio/video quality goes).
* Technically there's DCI 4k and Ultra-HD, with the former being slightly higher resolution than the latter - see http://www.extremetech.com/extreme/174221-no-tv-makers-4k-an... but they're close enough that even camera people lump them otgether as '4k' and the 10% shortfall on UHD gear is not considered that bad of a loss. If you're very concerned about horizontal resolution chances are you're using anamorphic lenses anyway.
I was referring to consumer DRM systems, not in-theater projection systems. Is there also a concern of Netflix-bitrate 4K video being used in theaters?
Netflixs growth forced the issue. Cable can't run on original, first run content alone. There is so much content that is on Netflix that it doesn't matter that it is all reruns.
Netflix would destroy the networks but also their main suppliers.
That is why Netflix is going into original content. If they won't fund it nobody will.
It's the inevitable market dynamic for a company like Netflix. They're a middle-man--the sell Sony's content, hosted on Amazon's servers, over Comcast's wires. Their business model lives and dies by what value they can add to that chain.
Don't get me wrong, I like Netflix. I don't have cable TV (and now that HBO Now exists, I don't plan to). But I've got Netflix alongside Hulu and Amazon Prime, and I see them as pretty fungible. Getting a good browsing/steaming UI together isn't rocket science, and all three are fine. The original content is the only thing that makes Netflix a "must have" for me.
No kidding about Comcast - Streampix? Talk about derivative naming. And it's priced to kill Netflix at $5/mo for cable subscribers.
I'm not so sure about the pirating scene - while big content providers likely will never kill it, they seem to have lawmakers in their pockets, and so will criminalize it as much as possible - expect draconian measures to destroy the most dangerous threat to big content providers.
Just like the drug market with all its weird research chemicals that are technically legal, I'm pretty sure the piracy scene can move faster than draconian measures can take them down.
It's hard to compete with free. At the moment, Netflix does a pretty good job. HBO might too if they can fully disentangle from cable. If prices get higher, or the content individuals want gets spread across too many streaming services people will watch less and/or pirate more.
“It will be like the Yankees and the Red Sox,” Mr. Hastings said. “I predict HBO will do the best creative work of their lives in the next 10 years because they are on war footing. They haven’t really had a challenge for a long time, and now they do. It’s going to spur us both on to incredible work.”
That guy has a ton of class. This war will only benefit all of us entertainment junkies.
No doubt, though there's also a fair degree of hubris in that statement. HBO is already going strong from a 15-year streak of unprecedented critical success, having birthed genuine cultural touchstones such as The Sopranos and The Wire.
Netflix is making an incredible effort to catch up: They're giving great creative talent a lot of creative freedom, and they've certainly put out some fine prestige content in their first three years, but even House of Cards isn't really batting at the same level as HBO's landmark achievements.
I think when Hastings says "I predict HBO will do the best creative work of their lives in the next 10 years," there's a tiny bit of projection there – he knows HBO will have to continue to put out landmark content because sooner or later, Netflix will indeed have its own, bona-fide Sopranos.
As a fan of long-form episodic cinema, no other rivalry could make me more excited.
I guess there is another, very big reason:
The Non-US markets.
The US is surely important, but Netflix has launched in Europe and faces a huge obstacle that very few US Americans know about - rights licensing is far worse.
Selling content overseas is a huge business, which means a giant time delay until something makes it to, say, Germany (even if not dubbed). Which worked in the past, but the Internet is forcing real time usage, see the piracy numbers worldwide for something like Game of Thrones (HBO, I know). There is practically no legal way to easily consume something like GoT the same time as it is aired in the US.
Not so for Netflix' own content.
House of Cards, Daredevil - all already available globally.
The world is a big place and Netflix is going after it, the US is just one market.
Just to note, that even Netflix makes mistakes with global content licencing.
In New Zealand (where netflix has recently launched) they have sold the rights to House of Cards so even though they own the content, they cannot stream House of Cards.
Netflix is making the same mistakes. They sold the rights of "House of Cards" to Sky Television preventing anyone from watching season 3 in most of Europe.
This is true. Incredibly frustrating, but, Netflix is a media company that needs to make money. It's too bad what we want (the future of video media) doesn't today jive with the avenues available for Netflix to increase revenues.
HBO is global (to some degree). I live in Sweden and (if I didn't have to go to work) I can enjoy the latest episode of Game of Thrones only hours after it's aired in the US.
Although we don't have HBO Go here -- we have a similar service called HBO Nordic. I'm almost certain that it's a HBO owned company, available only in nothern Europe though.
It does HBO Nordic injustice to say it is similar to HBO Go. HBO Go requires a subscription to the linear HBO TV channel. HBO Nordic is free of user-hostile tying to cable TV. And unlike HBO Now, HBO Nordic isn't Apple TV exclusive.
In other words the Nordic offering is better than either of the over-IP HBO offerings in the U.S. Says a lot of how dysfuntional the HBO situation in the U.S. is when they don't offer their best service domestically.
Here in Italy Game of Thrones is distributed by Sky, and for this season they went as far as airing it in English at the same time (ie in the middle of the night) as it was aired in the US.
Later the same day, at prime time, they aired it in Italian.
By the way, they are also online: you can find them both on skygo[0,1] and on skyonline[2] websites (why sky italy has two websites is a story for another day...)
please stop saying global when you mean developed world. global means available everywhere, netflix is in 50 countries. in south africa for example a lot of movies are plain impossible to get legally in any format. maybe internationally is a better word?
Good point and this is a core art of Netflix's strategy for its own content. It's not going to happen any time soon with content from studios and other distributors though, because international distributors usually buy the rights to a film for a 10 year period. Except for the biggest 6, most film distributors don't have multinational operations and even the big 6 don't have offices in every territory, so they can't just wave magic wands and abrogate existing international distribution contracts.
Netflix is well on its way to becoming the first of the 21st century "networks". When you think about a television network it plays re-runs of old shows, re-runs of old movies, movies that have come out of theatres, and original series.
The only difference between Netflix and say "TNT" or "FOX" (other than they don't have news shows) is that the content is available on your schedule, not the networks, and they don't put advertisements in their content they just charge you a monthly fee to have access to it.
They have, nominally 60M subscribers[1] world wide, and 40M in the US[2], out of a total of 113M TV households [3]. If half of their subscribers watched the series Daredevil (which I recommend) that would be the equivalent of Netflix getting a 20 rating. [4] That would be equivalent to a Seinfeld [ibid] which was NBC's hottest show for a very long time.
So what that means is that networks need to either adapt to this new model or die. And the more that die, the more content there is for folks like NetFlix.
Oddly enough, this sort of makes Roku the new Comcast :-)
The only problem is they're in the middle of having one of the better measures to end piracy be thoroughly dismantled. Consumers are not going to pay 10 different streaming services on a contract fee structure.
And it's pretty clear that's not the only problem: once they think they can, we'll be back to product lock in, region lock in, vendor lock in "our new show is perfect to get people to switch to Comcast!"
Netflix has shown an ability to think of the future and adapt. Congrats to them. They started mailing DVDs, went full force into streaming old TV shows and movies, and now are pivoting again towards exclusive programming.
As a side note, it wouldn't surprise me if they are deeply concerned about an Apple TV service with a similar interface as Netflix, but more / better content. When I hear Tim Cook talk about his ideas for TV, it seems like he hates the current way TV works. Most programs aren't live, but are still shown the way they were 50 years ago for no particular reason.
Pro: i'm watching twitch stream of pro-dota on my phone, there's a new menu I've not noticed before. Press it, click apple TV, it's now streaming seamlessly onto my TV. Similarly for any tv shows on my laptop - but only if they're .mp4 (ugh).
Cons: Awful menu and navigation. Comparatively expensive (assuming you're watching films - after 2 films you could pay for a streaming service). Search is bad and slow. Recommendations are all the same despite allegedly being split by genre. etc etc. It's barely better than any other smart TV to be honest.
I think Apple TV could work, but I don't think it's even close to being there yet
Seems like they're following in the footsteps of HBO, going from a distribution channel rebroadcasting others' content to being known primarily for their high quality original content.
I like where this is headed. The competition will be a boon for content consumers.
I'm hoping Netflix gains enough market share with their original programming that it becomes suicide for other producers not to list their shows on Netflix too.
Even if to pay for this Netflix has a premium version... ($20 per month for example)
Content is where I expect much of the real money will be made on the Internet, just as it was in broadcasting.
The television revolution that began half a century ago spawned a number of industries, including the manufacturing of TV sets, but the long-term winners were those who used the medium to deliver information and entertainment.
When it comes to an interactive network such as the Internet, the definition of “content” becomes very wide. For example, computer software is a form of content-an extremely important one, and the one that for Microsoft will remain by far the most important.
But the broad opportunities for most companies involve supplying information or entertainment. No company is too small to participate.
I'm wondering why Netflix don't make a few topical shows, which could potentially increase the loyalty of their subscribers and would be very inexpensive to produce. Having their own shows similar to the daily and weekly shows on Comedy Central and HBO would add a new facet to their offerings.
I could see that working. I would be surprised if anything like the Daily Show could be replicated without one of the cast members. But some other topical format with the right person. Like what Bill Maher is to HBO.
About 2-3 years ago, I said NF couldn't do what it is doing forever, as there is nothing preventing e.g. Disney or Time Warner from selling their content direct to consumers.
Obviously the netflix executives were ahead of me on this one.
Idealistically and technologically there was nothing preventing them from streaming directly, but realistically they had decades of contracts to re-engineer to do so, not to mention the fact that they are huge companies with a fundamental stability that prevents them from innovating.
From somewhere else (via NFLX Wikipedia):
In a 2010 New York Times interview, Time Warner CEO Jeffrey Bewkes downplayed Netflix as a threat to more traditional media companies. Bewkes told the newspaper, "It's a little bit like, is the Albanian army going to take over the world? I don’t think so." At the same time, he recognized that the company's DVD service may have contributed to a decline in DVD sales, and regarding the industry's willingness to make special deals with Netflix in the future, he added "this has been an era of experimentation, and I think it's coming to a close."
Oh, I see what you're saying now; the "large ships" are the current content holders.
I agree, and this is why netflix has time to build up a library of original content. It's bootstrapping its success off the backs of its future competitors. I will predict though, that when Disney's current contract with netflix expires (2020ish IIRC), they won't renew.
I don't watch any broadcast or cable TV anymore. Netflix and Amazon Prime video are it (and Prime only because it's bundled; it doesn't really offer anything I'd pay for on its own). This seems like a no brainer to me.
Netflix could pivot slightly and offer white-label hosting of content for each content provider. Spinning up a hosting service to compete with Netflix can't be cheap.
Is that because you don't trust yourself not to watch it all in a binge situation? The shows on netflix could easily be watched one episode at a time on a regular schedule if that's what you prefer. You get both options (and hundreds of other scenarios) instead of just the one decided by someone else (or else having to record it on a DVR to make your own schedule).
It's nice to know that the other people watching a show are also at the same point as you are (or relatively close), allowing you to speculate on what might happen next in the time between episodes.
I also like looking forward to the next episode, which doesn't really happen when you can watch that next episode immediately (and self imposed waiting doesn't feel the same).
I agree that one thing that's lost is the ability to discuss episodes with people as a show progresses. Since you never know what episode a person is on you can't really risk discussing things until you're sure the person has caught up. With weekly shows like Game of Thrones for instance, you can feel pretty comfortable discussing an episode amongst other fans. Not sure if that's really something I'll miss when it's gone, but it's definitely a big change with Netflix that ultimately started as a smaller disruption with DVR devices...
I suppose personally my feelings on the matter is even though I might lose the few advantages that you mentioned, the disadvantages far outweigh it and I won't miss the airing of shows like Breaking Bad or Suits that took one season and split them in half with gigantic gaps in between (months or even years), to the point where you can't even remember where the show was going by the time it returns. I like the freedom to watch at whatever schedule I prefer, without any kind of arbitrary limitations that may or may not suit my lifestyle at the time, and the confidence to know I'm going to be able to see a story through from start to finish once devote time to it...
Well there is a product/service in there. Discussion channels tied in with your Netflix Id so that you you can only discuss topics with people on the same schedule. You could also join a group which had the programming pre-determined, and drip fed the shows to you on a specific schedule, like every Sunday night. You get the benefits of a scheduled delivery of content and associated social benefits, but you also get to join a schedule which suits your times.
Reddit works well for that. The House Of Cards subreddit for example features a thread per episode, which has pretty much replaced my per-episode watercooler talk.
> It's nice to know that the other people watching a show are also at the same point as you are (or relatively close), allowing you to speculate on what might happen next in the time between episodes.
The shared cultural experience is nice, but utterly foreign to those of us outside the US, where the discussion arrives weeks, months, or even years before the show.
I prefer to develop my own schedule for watching a show.
Generally I wait for the entire season of a show to come out and then schedule several nights of viewing (over a couple months) with friends where we watch 3-4 episodes at a time. The downside of this is having to avoid discussion of the show in the few months after release.
With Netflix dumping seasons at a time it makes it much easier, and much more fun, to do this.
We'll lose the sense of community that comes from simultaneous viewings. But, people still bond over books and book series, which is what Netflix programming will be like.
I wish Netflix would provide their own content DRM-free. But they don't, so all their claims that it wasn't their interest to push DRM into HTML are not true.
A company should be allowed the freedom to do what they want when it comes to selling their own product. Why would we want more laws restricting business?
What if the truth was, a one time payment to watch a show like House of Cards cost $100-$200? By offering a subscription they make it more accessible to more people (They let you cancel your Netflix subscription at any time)
I dunno, I'd love to be able to pay Home Depot $10/month and just have them deliver any tool I want whenever I want it. Obviously streaming movies don't put wear and tear on the movie, but I found the earlier poster's analogy (now deleted) rather attractive.
Netflix is also getting squeezed by ISPs like Comcast, who want to charge them for the right to deliver video to Comcast's customers who already paid for their bandwidth.
So Netflix' only way to survive is to develop its own content. If it's dependent on other people to provide content, they'll jack up their prices to take Netflix' profit margins.
So now you have 5-10 competing services, and if you aren't paying attention, you don't know what shows are available on what service. Meanwhile, if you go to a file-sharing website, you can get every single show and movie. So Netflix (and its competitors) have less compelling of a value proposition, if you have to pay $10/month to several different services to get all the shows you might want to watch.