• Kirby Grines

The Streaming Wars: Netflix ain't Scared. Disney & the Future of TV

Updated: Aug 20, 2019

As Apple, Disney, and NBC Universal are set to launch their video services, Netflix is unconcerned over the loss of licensed content.

In an earnings call last Tuesday, Reed Hastings said the company has prepared for the loss of "second window," or licensed content.

In 2012, Netflix dove into originals with House of Cards and significantly changed the cost structure of its content spend.

Unlike the content Netflix would license from rights holders, such as licensing “Friends” from WarnerMedia for $100 million/year, creating its own original content allowed movies and TV Shows to be created at a fixed-cost. And their lead in subscribers benefitted them lower content costs per subscriber.

For example, if Netflix paid $100 million for House of Cards and their streaming business had 30 million customers, then the cost per customer would be around $3.33.

On the flip side, a competitor with a million subs would have to pony up $100 per customer.

According to The Information, the value that Netflix puts on content licensed from other studios at Dec. 31 was $14.1 billion, more than double the value of the programming Netflix produces entirely in-house—valued at $6 billion. That suggests Netflix is still vulnerable to big entertainment companies pulling content off the service in favor of their own streaming offering, as Disney is doing ahead of the launch of its service Disney+.

On last week’s earnings call, Ted Sarandos, Netflix chief content officer said the top 10 most-watched shows on Netflix are all original programs, and only four non-Netflix are in the top 25.

This is a far cry from the data reported by analytics firm Jumpshot, which stated that in 2018, 14 of Netflix’s top 20 shows, and all 10 of its top 10 shows, were broadcast-network reruns.

So who’s telling the truth?🤔

We may never know, but Netflix is promising to be more transparent with its viewership data, so that’s promising.

Netflix added 9.6 million paid subscribers in Q1, which represents its biggest subscriber boost since its launch. Some 1.74 million new customers signed-up in the US and 7.86 internationally.

Netflix now boasts nearly 149m subscribers globally, up almost 10m from last quarter. Over 60m of those subscribers are in the US. Game on. 


Feeling The Churn: Why Netflix Cancels Shows After A Couple Of Seasons & Why They Can’t Move To New Homes. Link

Disney and the Future of TV. Link

The Companies Disney Owns: A Map of Disney's Worldwide Assets. Link

How Iger Broke Disney’s Netflix Addiction. Link

Disney's BAMTech Investment Was A Smart Move. Link

Hulu Buys AT&T’s Minority Stake In Streaming Service For $1.43 Billion. Link

Hulu CEO Randy Freer Offers Updated Strategic View To Disney Investors. Link


The Rise of OTT Has Forced Brands to Overhaul Their Existing Video Strategies. Link

Microsoft is taking its customers back from Walmart and GameStop. Link

GoT return pirated nearly 55m times. Link

DirecTV Now Drops NFL Network. Link

WarnerMedia Builds a Better Streaming App for its Upcoming OTT Service. Link

Advanced Ad Experiences Beginning To Expand Across OTT, Connected TV Platforms. Link

Viacom will debut 15 channels on Pluto TV to bolster its upfront pitch. Link

Cinedigm Bows CONtv on AVOD Service Pluto TV. Link


An Easy Definition Of Cord Cutting. Link

SVOD homes to overtake traditional pay TV in 2019. Link

Sports OTT technology spend will hit $6.8 billion by 2021. Link

OTT has a twin challenge of retaining viewers and balancing RPUs. Link

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