The Service Sneezes
As we are all aware, this is the year that Netflix won entertainment. The Streaming War has been engaged, and it has blown not just the competition out of the water, but seen its great historic enemy—movie theaters—not just hobbled but actually shut down. As a result of which, the world has been chained to their televisions at a moment when Netflix is the vastly dominant service, as its quarterly numbers circa COVID suggest.
So if everything’s coming up roses, if Netflix has the future all figured out, why is it firing execs like it’s open season on anyone wearing Zegna, cutting shows left and right, issuing caps on new development, getting beaten on the big splashy deals that are its signature, and significantly raising prices? And, late breaking now, the Kenya Barris exit, which is a pretty major turn of fortunes as far as Netflix relations with brand name showrunners goes.
I get you gotta have the cold-blooded Silicon Valley courage to pivot towards the future, and there’s the Keeper Test and the algorithm, and God knows what other tech pablum that dictates keeping your company in a constant state of upheaval. But all the same: Does this look like the behavior of a company that’s got the future all figured out? Or a company that is in a medium state of panic?
(Also interesting to consider: in the past whenever The Service has announced a rate increase, social media has gone into a F5 level conniption fit over the news. This time there’s been barely a flutter. Raises the question of whether Netflix rushed to get this news out before the election so it could be buried under a flood for political obsessing, with little oxygen left for a mass freakout over a few dollars more a month for Netflix.)
We know the reasons why Netflix has conquered the world and will own all of entertainment forever, but just as a mental exercise, let’s look at some reasons to perhaps be concerned about what the medium-term looks like for The Service, over say the next 18 months.
Reasons to be Bearish on Netflix
1. Theaters will be back. As will every other reason for people to leave their houses and run away from the couches that they’ve been chained to for a year plus.
2. As theatrical releases return, it’s going to be a tougher fight once again to break through the cultural mind space with new releases when you’re up against companies dumping $200 million in advertising around one title.
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