Re:The Economics of Netflix's $100 Million Show
by halo on Monday February 04, 2013 @11:37AM
(#5165040)
Netflix's big long-term advantage is buying power.
They have 30 million users spending $100/yr. Assume they spend half their income on content. That's $1.5bn/yr. That's a huge amount of money, and it's only going to get bigger as they grow and expand into new territories.
Increasingly, Netflix revenue is so high that it will seem inconceivable for content owners to turn them down in a gamble to go it alone and increasingly hard for anyone to compete.
I am extremely bullish on Netflix. I think they have a sound business model with huge upsides and the downsides are hugely overstated.
Re:The Economics of Netflix's $100 Million Show
by Aron on Tuesday February 05, 2013 @03:27AM
(#5169732)
They are spending about 71% on content. Before they hit 40M subscribers they could produce 13 hours of House of Cards level content per week. That would surely be something.
They have 30 million users spending $100/yr. Assume they spend half their income on content. That's $1.5bn/yr. That's a huge amount of money, and it's only going to get bigger as they grow and expand into new territories.
Increasingly, Netflix revenue is so high that it will seem inconceivable for content owners to turn them down in a gamble to go it alone and increasingly hard for anyone to compete.
I am extremely bullish on Netflix. I think they have a sound business model with huge upsides and the downsides are hugely overstated.