The famous and admired "king of
, has built a juicy business with a value that amounts to US $ 125,000 million. And in the last three months sum 6.7 million new subscribers, increasing its total user base to 153 million worldwide.
But the next three months will be the most decisive in its history.
Soon, Netflix will be racing
HBO Max and
Apple TV +, all of them with a well-known brand and a strong desire to take their share of the streaming business.
Last Wednesday, Netflix wrote to its investors to tell them that having competition was going to be something positive. The rising tide of streaming services will simply tempt more people to get away from "linear television," as they defined it, and to use more streaming services.
"Just as there was an evolution from open television to cable television, these unique changes in a generation are very broad and open up new and great opportunities for many actors," the company told investors.
"For example, during the first decades of the cable, networks such as TBS, USA, ESPN, MTV and Discovery did not cover a large audience share per se, but collectively."
Netflix said its growth rate in the United States and Canada has been almost identical in the last six years, despite the fact that only one of those markets – the United States – has a significant competitor: Hulu (a service on demand from Disney).
That could be the case. However, Netflix's arguments refuse to address what may change as to what they will offer their subscribers in the coming years.
The Netflix catalog is in the process of being chosen, with competitors that recover programs and movies that they agreed to broadcast on Netflix at a time when they still did not have their own streaming product.
Great successes like "Stranger Things" have not boosted the growth of Netflix subscribers in their home country, United States
A high profile example, for example, has to do with the Friends series, which has been a great success for Netflix since it was added to its platform in 2015 and that in 2020 it moved to HBO.
In what was seen as an effort to counteract that loss, Netflix paid the astronomical figure of US $ 500 million to secure Seinfeld's rights.
Unlike Friends, Seinfeld has a much smaller international appeal and looks quite "burned" if we compare it with
Curb Your Enthusiasm, a kind of Seinfeld spin-off created by Larry David, and whose rights will have HBO Max exclusively.
But Friends and Curb Your Enthusiasm are just two examples.
Netflix is losing series at a dizzying pace. British classics like The Office are now in Britbox. The American version of that series, rated by many Netflix users as a great "background noise", is also being removed to include the new NBC streaming service, Peacock. This will be launched in the next month of April.
That means that Netflix needs to rely even more on its own original content.
The "Netflix Original" brand is already well established and is well recognized and respected. Netflix's original products took 27 awards at this year's Emmy (HBO gan 34, Amazon 15).
"While the new competitors have some very good titles (especially catalog)," Netflix told investors, "none has the variety, diversity and quality of the new original programming we are producing worldwide."
That statement about its quality will be discussed on the pages of the Hollywood press, not here.
But what is inevitable for Netflix is that, despite the favorable critics, those original productions are not having the impact that investors expect.
Even with the return of one of its most prominent originals,
During the last quarter (the last three months to September), only 530,000 new subscribers in the United States joined Netflix, below Wall Street expectations.
In the previous quarter, I lost 126,000 subscribers in the United States.
Subscriber growth then comes mainly from investment in international markets, with 6.26 million subscribers added in the last quarter.
Apple beat Netflix "The Morning Show," starring Jennifer Aniston and Reese Witherspoon
Without a solid catalog, Netflix knows that it must continue to invest in original content to survive, an extremely costly effort: analysts predicted that the company would spend this year around US $ 15,000 million in new content.
To maintain that type of investment, Netflix told investors that it was looking to borrow more money, in a context of investors increasingly concerned about the possibility that the return on investment will not arrive and in which, with the pockets Filled with new competitors, the price of acquiring new programs may increase even more.
The executive director of Netflix,
Reed Hastings, admitted that his company puj alto by
Fleabag, which ended up being a co-production between Amazon and the BBC and one of the series most talked about last year.
Phoebe Waller-Bridge, co-author and star of the series, has just signed an exclusive contract with Amazon.
Meanwhile, Apple beat Netflix the series The Morning Show, Jennifer Aniston's return to television, where she appeared alongside Reese Witherspoon.
Apple's strength brings another advantage: every new purchase of an Apple device will come with an annual Apple TV + subscription. Netflix has a lot of work to convince Apple users to add their service. Like all other competitors, to be fair.
Netflix seems in a state of precariousness. Their old programs are disappearing, and the company faces an unprecedented struggle for new ones.
Reed Hasting's visionary approach to issuing films for
It gave Netflix a 12-year lead, but that counts little when customers can stop paying whenever they want.
As Hastings said last month, his company is now part of "a whole new world" (though, if you want to see the
Aladdin's movie that includes that song … it's exclusive to Disney +).
. Netflix: the challenges facing the king of streaming in the next three months – LA NACION