November 30, 2012 • 06:31:52 p.m.

The (supposed) demise of Netflix

By Zach Walters - zwalters@shawmedia.com

I recently came across an article regarding how Netflix is in big trouble. The editorial points out facts such as competition from other streaming services, as well as the cost of content acquisition. These are pretty good points, but I believe there are some other factors that are being ignored here. Analysts have been prophesizing the downfall of Netflix for a while now, and while the company isn't exactly well-off, they're also not dead yet.

I'm mainly taking issue with the article's comparison of an online streaming service to a movie theater. You can make some connections with the content acquisition, but there are also major differences, such as the fact the movie theater's have a much higher amount of overhead to deal with. Netflix also doesn't have the restriction of only buying brand new content, and can draw in subscribers by picking up classic movies and television shows on the cheap.

The writer also brings up the fact that services like Hulu, Vudu or Xfinity have huge companies behind them to provide the money to spend on content. On paper that's true, but I think it's important to consider the fact that Netflix basically started this business, is in more homes than any other service, and (in my opinion) still has the absolute best variety of content. Not to mention the fact that they've begun branching out into original programming like the new season of Arrested Development, and Kevin Spacey's House of Cards. Honestly, my only issue with Netflix is that for some reason they haven't alphabetized the instant queue (get on that, guys).

I will admit that Netflix as a company has some hurdles to jump, and a bit of restructuring to deal with. I'm not saying the company won't ultimately stretch itself too thin and collapse, only time will tell. But right now they still have a significant advantage over the majority of services.

What are you thoughts? Email me at zwalters@shawmedia.com or find me on Twitter @geekfeednews.


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