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Netflix is not trying to grow their subscription base. The "risk" to which he was referring to is the risk of the show failing completely by some metric (e.g.

Netflix is not trying to grow their subscription base. The "risk" to which he was referring to is the risk of the show failing completely by some metric (e.g. no one currently subscribed to netflix is watching it), and all that money being effectively flushed down the drain. It's the risk of going overbudget. Or the risk of actors and directors having a falling out. There's dozens of factors that go into making a show successful and this test is to see how Netflix as a company can handle them--either directly or by proxy. If this test is reasonably successful then maybe in the future, they will make a play to have original content garner them more subscribers as a competitor/partner to say HBO or Showtime.

ankeshk 16y ago
Thanks for making some good points. You've listed down 3 risks. - Risk of no one watching. - Risk of going over budget. - Risk of actors or directors having a fall out. (Or something else occurring that makes episodes not coming out on time if at all.) And you make a good point that thats why Netflix is trying with 1 show and not 10. But aren't all these risks you listed further minimized by experimenting with a $10 million show than a $100 million show? My thinking is: Netflix does not care about risk at all. If they wanted to minimize risk, they would have gone with lower priced shows. Or they would have gone with a lot more shows. The only reason they have gone after a high priced mainstream show is as a negotiation tactic. To make a stand against studios and cable companies. "Play ball with us. Because if we can't play together, we will compete together."
- true_religion 16y ago
  I think Netflix isn't trying to minimize the risk, but rather "test the waters" as it were to see what level of risk exists. It's more of an experiment than a business strategy.

ankeshk 16y ago

Thanks for making some good points. You've listed down 3 risks. - Risk of no one watching. - Risk of going over budget. - Risk of actors or directors having a fall out. (Or something else occurring that makes episodes not coming out on time if at all.) And you make a good point that thats why Netflix is trying with 1 show and not 10. But aren't all these risks you listed further minimized by experimenting with a $10 million show than a $100 million show? My thinking is: Netflix does not care about risk at all. If they wanted to minimize risk, they would have gone with lower priced shows. Or they would have gone with a lot more shows. The only reason they have gone after a high priced mainstream show is as a negotiation tactic. To make a stand against studios and cable companies. "Play ball with us. Because if we can't play together, we will compete together."

true_religion 16y ago
I think Netflix isn't trying to minimize the risk, but rather "test the waters" as it were to see what level of risk exists. It's more of an experiment than a business strategy.