It feels a little like we’re turning a corner in the Age of Netflix Hooplah, that the industry and the media are inching slowly forward from “THEY WON ENTERTAINMENT!!!” to “So . . . what comes next here?”

I wouldn’t say dots are being connected yet, but they are becoming visible, and more and more of them are everywhere. In today’s special edition, we’ll lay them out. Maybe–probably–it’s too soon to say what they will all definitively add up to, but there’s enough cause for . . . head scratching to suggest the prevailing hoopla is overdue for an update.

To recap, or for those who have joined us recently:

1. Unquestionably, Netflix won Round 1 of the War for Entertainment.

2. In doing so, it created a service beloved by many, with lots of wonderful shows.

3. Netflix did this, however, in the great tradition of 21st Century Tech Startups: with massive, flood-the-zone spending via cash provided at insanely high valuations. You can think of the Netflix flood in the same breath as your $6 crosstown airport ride from Uber–a wonderful miracle of technology, and if you close your eyes, you can actually believe this is what life is supposed to be like.

4. That, of course, cannot go on forever. Even if it feels really good.

5. This sort of spending makes sense only if you can bludgeon your way to monopoly pricing power, or at the very least, an untouchably, near-permanent position of field dominance.

6. Netflix has indeed caused huge dislocation in Hollywood, increasing expenses and prompting the death of one studio, with others possibly on the way.

7. But it has not delivered a knockout punch that permanently removes competitors from the field.

8. The competitors–not just Hollywood, but also equally deep-pocketed foes from Netflix’s home galaxy like Apple, Facebook, and Amazon–are coming. Netflix will not be the only giant on the streaming subscription landscape for long.

9. Netflix is currently in the hole for about $20 billion in debt and obligations and still operating at a loss.

10. Despite the tsunami of original content, an estimated 80% of Netflix eyeballs are watching licensed catalog content.

11. U.S. growth has topped out.

12. In the next few years, as the studios launch their own services, that catalog will mostly vanish.

13. Not only vanish, but 80% of what Netflix viewers are currently watching will be living on competitors’ services.

As we head into Round 2 then–as the battle gets underway for seats in the Great Entertainment Semi-Finals–Netflix is at this point guaranteed a berth in that showdown. The question is, how well positioned is it to win, or even survive, the next round?

If much of the commotion of this first round has been about creating content to fill the gap when the licensed content goes away, just how far down that road is Netflix really? Did Video City Ted and company expect to be still 80% dependent on other people’s shows even after spending tens of billions? In what shape is its original catalog (and its pipeline) to compete? How is the Netflix culture geared towards a landscape that’s about to become much more competitive, one where it might have to play by the same earthbound economic laws as everyone else?

Put another way, is this breathtaking new business quietly rolling down the same track as Tesla and heading eventually, when the confetti cannons go quiet, to Elon Musk land?

To read the rest of this issue, for a good hard look under the hype, subscribe today to The Ankler and read all of our special Netflix edition!

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