Holding almost 150 million users Netflix is the largest subscription service on the planet. Netflix’s success is now shaping the whole entertainment industry. Trying to catch-up with Netflix, the largest U.S. media industries are driven on reinventing their operations as a direct-to-consumer business model. The Netflix impact across the entertainment industry has taken heart in deep and significant ways this year, but is it undefeatable?
What are the challenges Netflix has to face?
Disney and Warner Media are planning on developing their own direct-to-consumer streaming markets, are expected to launch their services. Apple is launching its own streaming service named Apple TV. Amazon and Hulu look forward to continuing growth in their individual streaming services. Also there is HBO with its super hit series, Game of Thrones. Meanwhile, Netflix’s prices continue to increase as the company aggressively contributes more new original content which has pushed them into a debt of 3.5 billion.
The new competition has given customers brand new and a wide variety of entertainment options to choose from and it will be challenging to continue as the market leader.
Is the threat real?
Netflix has openly enclosed that it does not observe the forthcoming competitive streaming services as threats.
Netflix CEO Reed Hastings stated, “There’s a ton of competition out there, and Disney and Apple add a little bit more. But, frankly, I doubt it will be material.”
I believe what Reed says is evident because I believe Netflix is still providing their services cheap. Disney is assumed to roll out its service for $6.99 and Hulu dropped its basic plan to $5.99, Netflix’s price will still be affordable. When Netflix increased their price in the US only a minimum number of viewers expressed concerns. The stock prices only went up after the price rise. Even if you bundle Netflix, Disney, and other streaming subscriptions, the price doesn’t even come close to the 3-digit cable bills.
Even though the company has a ton amount of rivalry it will definitely continue to co-exist peacefully without facing a crunch in their market share because the content is their key. The company has struck the cord among millennials and continues to add popular content to its platform which customers will fear missing out.
Netflix: A customer perspective
As far as my research went, Netflix users are only worried about adding more streaming platforms to their already existing package and almost no one is talking about removing Netflix from their options.
Netflix has a huge subscriber base of 148.9 million and people have become habitual to the streaming service being a part of their entertainment time spends. The users are more likely to subscribe to more than one streaming service, but pretty much Netflix occupies one of those slots.
Netflix is not without its own major challenges but upcoming and existing streaming services still have to prove their merit to customers and in that way Netflix has a great head start over all of the others.