From Netflix’s 280,000-square foot studio in Hollywood, chief executive Reed Hastings revealed that the company has no plans to enter the live TV market in news or sports, as its rivals Hulu and Amazon Video have done. Instead, the company is investing $8 billion in original content this year, part of its larger strategy to fend off competition from these popular services and a growing list of emerging competitors. Hastings also explained that Netflix has no plans to introduce advertising.
Engadget reports that Hastings also pointed to the company’s Q4 2017 earnings report, when it added 8.3 million new subscribers, “its largest single-quarter growth ever.” He emphasized that Netflix will never follow its competition. “If we do our own Prime service, we’ll never succeed,” he said, adding that Netflix’s no ads policy is also an important differentiation, “despite the potential for lower prices and creating more revenue.”
Disney is a potential future competitor. The company will debut its own streaming service in 2019, which will reportedly be cheaper than Netflix. Disney’s ownership of Marvel “could create friction with future developments of popular shows.” Netflix has leveraged Marvel properties to great effect.
“We obviously want the Marvel Television series currently on Netflix to have a long and lauded run,” said Marvel Entertainment president Dan Buckley, who also noted that, for new projects, it would look for “networks and platforms that are the best fit for that content.”
Disney announced in 2017 that it would stop streaming its content exclusively on Netflix in 2019. Hastings said he isn’t too worried, noting that, “it’ll be up to Netflix, not its rivals, to be sustainable and continue growing.”
Recode reports that, according to Netflix, “70 percent of its streams end up on connected TVs, instead of phones, tablets or PCs.” The news didn’t surprise the company, which “has spent a lot of energy working out integration deals with pay TV distributors like Comcast and Sky.” It’s not alone. YouTube revealed that its live TV service, promoted as a mobile-first service, “was generating more than half of its streams on TVs.”
Netflix added that 40 percent of its signups are done from a PC, with phones accounting for another 30 percent. But, six months after signing up, “most viewers have moved from their smaller screens to the biggest one in their house.”
Netflix’s Secrets to Success: Six Cell Towers, Dubbing and More, Variety, 3/8/18
Netflix Subscribers Streamed Record-Breaking 350 Million Hours of Video on Jan. 7, Variety, 3/8/18