By The Entertainment Strategy Guy
As of today, Netflix stock has lost nearly half its market value off its 52-week peak. But last week, one long time Netflix skeptic, analyst Michael Pachter, wrote an earnings note called “Hell Freezes Over”, with this key quote:
“Netflix’s first mover advantage and large subscriber base provides the company with a nearly insurmountable competitive advantage over its streaming peers.”
I don’t agree.
The first article I wrote for The Ankler in 2022 was “Streaming’s Winner-Takes-All Theory Collapses”. A series of charts, instead of showing an “insurmountable” lead, revealed other streamers catching up to Netflix. Though the pro-Netflix bulls predicted, predicted and predicted that Netflix would crush competition, the entry of HBO Max, Disney+, Discovery, Paramount+ and others into the streaming wars have eaten into Netflix’s market share in America.
Armed with some new data from Q4 2021, and subscriber information gleaned from February’s earnings calls, I want to show just how competitive the market is becoming, and that the dominance of any one player cannot be assumed.
1. First, remember all those theories that Netflix would become de facto TV, synonymous with viewing? Not so fast.
One of Netflix’s early advantages — and one reason why folks thought it would take over TV — is that for many people, it’s their “go to” service when they sit down each night to watch the boob tube. You see if something is on there worth watching before going somewhere else. According to Hub Entertainment Research, who regularly surveys customers, this lead is slipping:
Okay, now into the nitty gritty of what exactly is going on. Let’s start with the biggie…
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Also on The Ankler:
Richard Rushfield on the 14 Big Question Marks that loom over entertainment right now.
Boz enters the Hall of Fame! Guess who’s coming to Star Wars? And an Academy members lock out. It’s all in this week’s edition of The Transom, our weekly round up of the scuttlebutt on the street.
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Then go deeper. For an understanding of why so many of us feel this way, start with The Pit in Your Stomach is Real, and continue on to “It Feels Like the Last Days of Rome” from new contributing editor Nicole LaPorte.
On the departure of Netflix’s flamboyant marketing chief, Bozoma Saint John, and her clap back.
The Glossy is up! Men, ditch your jackets for the shacket! And Power of the Dog’s Kodi Smit-McPhee has a surprising new player in his corner.
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