The Potential Demise of Netflix

How A Recent Industry Transition Could Bring Us To The Unexpected Demise Of Netflix

All industries evolve, all industries adapt, and occasionally, you find that one company that takes the risk to completely innovate the industry as a whole. Those are what I like to call, “game-changers.”

There is no doubt in anyone’s mind at this point that Netflix is one of those innovative ‘game-changers’ that has single-handedly shifted the entire entertainment industry. Think about that, not only did one company come out of nowhere to shake up (and that’s an understatement) a particular industry, their innovation caused long lasting effects on the entertainment industry, something many would deem untouchable.

Sure, going head to head with entertainment conglomerates such as Disney, NBC, CBS, Blockbuster, Redbox, the list goes on… Netflix changed television, and more or less, for the better.

Particularly companies such as Blockbuster & Redbox, two video rental giants in the late 90s and early 2000s were victims due to the lack of response of Netflix’s streaming expansion. When Netflix began, it was similar to names such as Blockbuster & Redbox, you ordered a movie (granted, online), and it would be mailed to your house the next day or so. When finished, you’d send the disc back, and Netflix would retrieve it.

Talk about a process? Was this format really sustainable? Ahh, but Netflix’s plan was never to conquer the movie rental industry. Blockbuster & Redbox were just the first victims that succumbed to the rise of Netflix. Netflix brilliantly took advantage of the rapidly growing internet industry, and based their entire format on video streaming. The rest is history…

You know how it goes, Netflix eventually charges a monthly subscription price for unlimited access, eventually starts creating original shows that are accompanied by more popular content, and years later, they are the all-mighty, all-powerful ‘Netflix’.

Since that point, everyone else has followed with streaming services of their own. While many rival competitors have gained footing in the ever-growing streaming realm, Netflix has remained king.

That is about to change.

Networks and cable companies continue to offer advancements in video streaming content. While Amazon Prime & Hulu were the only two relevant competitors for years, now everyone is getting in on the action. Netflix has been able to remain atop throughout the streaming expansion, but with a recent decision made by Disney, Netflix will eventually meet its’ ultimate demise.

Netflix has officially awoken a sleeping giant. That giant just got a lot bigger with the purchase of Fox studios, Disney. Disney hasn’t been a major player in the streaming game, and they have finally decided to move in that direction with a new streaming service meant to rival Netflix.

So why does Disney necessarily defeat Netflix at it’s own game?

Netflix offers an enormous amount of content, in fact some say it likely has become a watered down library that makes it difficult to find something to watch anyway. A lot of this content is purchased from…

Disney! While Disney may honor the current contracts for the content Netflix currently holds rights to, there will be a point where those contracts will run out, and obviously Disney will not be renewing. Disney will then take their own content, offer original content, and reclaim a good portion of content from their competitor.

So, that leaves Netflix with a much smaller library (perhaps a good thing, but Disney content sells), and would leave them to rely heavily on their original content. While this might be viable for a few years, eventually it will likely lose a big enough subscriber base to the point that creating original content will need a much stricter form of approval.

Meanwhile, Disney’s new streaming platform, will offer Disney classics, original movies, series, and will likely have near every piece of content associated with Disney at the viewer’s disposal. Disney will also not be relying on their streaming service for consistent cash flow, as they have plenty of it from numerous sectors of the company.

Ok, some may say Netflix could still win this battle if they are smart about the content they produce, but here’s where that thought ends, Disney is rumored to be including their new sports streaming channel ESPN+ within the streaming package.

So now, when one chooses a streaming services, they can choose from a service that offers a smaller library and no live sports; or they can choose a larger library that would offer live sports at no additional cost.

Disney doesn’t play around, and Netflix has made enough noise for Disney to intervene, and once that happens…

Well, ask FOX how that panned out for them.

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