In many ways Netflix is the present of entertainment, so predicting it is also the future isn’t exactly a major leap. Yet there is disagreement among analysts whether Netflix can take over the entertainment world for $7.99 a month. The disagreement is unusual in that while the naysayers admit Netflix can make money, content producers like TBS and HBO make more money, largely because of their relationship with advertisers.
The counter to that argument states that advertisers may be able to dictate terms to others in the industry; they have no power over Netflix and consumers love them for that very reason. Netflix has also fired a warning shot across the bow of content producers by churning out their own award winning content. House of Cards, Marco Polo, Orange is The New Black, Bojack Horseman and Daredevil are all compelling evidence that HBO needs Netflix worse than Netflix needs them. Here are four reasons Netflix is going to be the company still standing when the smoke from the entertainment battlefield finally clears.
The same content is a better experience on Netflix than on cable. Watching the same show on cable requires sitting through commercials, banners and all manner of intrusive advertising. There’s none of that on Netflix...at least not yet. I can watch an hour show in 40 minutes. Content providers have taken to speeding up the play rate of shows so they can squeeze in an extra ad. Netflix focuses on the user experience, content providers focus on revenue. Netflix wins.
You can watch Netflix on virtually any device, though I haven’t seen any tests on an Apple watch yet. Sitting in the dentist waiting room or waiting on your doctor is now time you can fill your mind with shows like Cosmos or a National Geographic special on your phone. Or just watch a movie. As a quick and largely unscientific experiment, I ran a similar test on our local news stations, none of which would load or play content on my Android tablet reliably.
With Netflix you’re not fixed to a time and date for a particular show or dependent on some type of recording device. You can get the shows you want, when you want. It is the ultimate convenience that has given rise to the relatively new phenomenon of binge watching. That's when people will spend hours catching up on one series. Binge watching has become a form of “staycation” for many, a little escapism mini-vacation of sorts. In the history of technology it’s always safe to bet on convenience.
The Competition Stinks
The future of entertainment delivery becomes really clear when you survey the competition. Cable providers, satellite providers and broadcast television have all been slow to react to the new competitive model and the few efforts they have made have been dismal. Even when a company called Aereo tried to drag local television, kicking and screaming, into the modern world of online delivery they were basically sued out of existence. Cable, satellite and local broadcasters are all locked into a business model that doesn’t fit the modern world and, instead of innovating a new way forward, they’re stuck in yesterday’s business model. To understand why all you have to do is watch your local news and count the number of car commercials.
Recently I was at a hotel in Orlando and propped my tablet on the table in the restaurant for breakfast and used the hotel wifi to watch an episode of House. Despite attempts by some providers like AT&T to make content more available, they fall short of the most basic things you can do with Netflix. That’s why there is no doubt that Netflix will come out on top.