“[Netflix's] trajectory,” wrote
Sean O'Neal of The AV Club last week, “will make a fascinating
cautionary example for some future business class” and today we got
the next step of that process. What he and I are talking about is the
HBO-ification of Netflix, wherein the streaming video company seems
bent on taking what is unique and interesting about its company and
peel it away, layer by layer, until what is left is the same boring
HBO knockoff cable channel that we already have ten of. Don't believe
me? Reuters has followed up on last week's news that the video
company is planning on switching to a model of 60 percent original
content and 40 percent licensed content by reporting that Netflix's
next move is to shop itself to cable companies in the hopes of being
added to their channel offerings. According to the report, “the
talks could lead to Netflix becoming available as another on-demand
option for cable subscribers through their set-top boxes, according
to three people familiar with the talks.”
What
made Netflix such a cultural force was the simplicity and dazzling
access provided by the service. It was like paying $20 a month and
being given the keys to the video store and the authorization to
watch all the movies and TV shows instantly or, if it wasn't on
there, you could wait a day and get it in the mail. It had all the
perks of piracy (quick, instant access to a massive library of
content) but it actually got your money to the people who made the
content. Now, however, the streaming library has been gutted, the
mail service is dead, CEO Reed Hastings can't throw around the
letters H, B, and O enough, and there's talk of Netflix becoming a
cable channel. What happened?
My
father taught me that at the end of every mystery is money and, not
surprisingly, that's pretty much the case here. When Netflix first
signed the deals with movie studios and TV networks to stream and
mail their products, streaming was a mere lark, a throw-in that
Netflix paid very little to get. Now why, in 2005 or 6, when
torrenting was already gaining speed and it was clear that bandwith
and Internet speed was only going to increase, no one seemed to
understand that instant streaming would become more popular is a
mystery to me. But whatever the case, no one foresaw the explosion in
popularity instant streaming would provide and so, when the deals
came up, the content providers started charging an arm and a leg and
Netflix clearly decided that their model would not be sustainable and
made adjustments.
But
what I don't get is why Netflix has decided to go to war with the
content makers, the HBOs and movie studios of the world, and align
itself with the people whom they were already poisted to takeout: the
providers like Time Warner and Comcast. That question, I think, will
be the one that haunts Netflix, no matter where they go from here. As
streaming decentralizes and consumers like you and me have to go to
dozens of different places to watch what we want, one can't help but
look at Netflix and wonder about missed opportunities. Why would a
company that could have been the next Facebook decide to be the next
Showtime instead?
--
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