6 ms·

A certain public American company I used to work for reached 20 million users. They stayed at 20 million users for years. Sometimes they gained some from the co

A certain public American company I used to work for reached 20 million users. They stayed at 20 million users for years. Sometimes they gained some from the competition, sometimes they lost. The net average was 20 million with no real way to grow. The problem was, every quarter they had to show growth or their stock price would tank. This was a profitable company with lots of cash in reserve. The only way to grow was to merge with a larger company and essentially disappear from existence, transferring customers to a new rebranded service, which is exactly the same service but more expensive. That expected quarterly growth is the bane of any company. And is why Netflix will jump into video games when it has no business doing so.

powerapple 5y ago
Video games could be a real good extension to their business. They have all the technology to deliver content to users, games are just another kind of content. I don't know how this can pan out, but I am excited for Netflix. I hope they have a plan to provide streaming games, and this is just a start.
- gelert 5y ago
  To offer a more pessimistic case this was true for Google, whose Stadia product flopped, and it was true for Amazon, whose video games utterly failed to take off. Currently something like Microsoft gamepass is a far better choice if you want to subscribe and play videogames. On another note, Netflix has experimented with videogames before using Telltale "choose your own adventure" style games and fitting them into their existing product. They also did a similar thing with Bandersnatch a choose your own adventure from the film side. So I think with the demise of telltale netflix might just be bringing that in house rather than trying to offer a wholesale alternative to existing videogame providers.
  - sofixa 5y ago
    > To offer a more pessimistic case this was true for Google, whose Stadia product flopped Has it now? Their locations and games only keep growing, and the service is still their. Flopped is a bit harsh.
  - p1necone 5y ago
    Yeah but Google made some stunningly poor decisions and have a very lacking game library compared to pretty much every single other streaming platform/console/steam/epic/gog/whatever. With their existing tech chops I don't think Netflix would have to try very hard to put out a significantly better service than Google did. "Pay $X a month for this not garbage library of games, play on any device capable of handling the video stream and a gamepad". (Yes I know Stadia have fixed a lot of these issues now, but they didn't for a long time, and it's too far past the initial hype unless they get no new competition for a long time). They also have a huge existing install base, stick the Gaming thing on the menu, advertise a trial, bam people are hooked. The crucial thing is to make sure there's some sort of connection quality test that pops up a "hey, your internet doesn't seem so hot - your experience might not be great, but hey have a go anyway it might be okay" message. Otherwise a huge chunk of the market is just going to assume the service is terrible and then talk on social media about how the service is terrible, and tank the product.
  - bryanrasmussen 5y ago
    >To offer a more pessimistic case this was true for Google, whose Stadia product flopped I don't think that Google has ever shown any ability in pivoting if their first idea was not super successful. So they don't really have any business DNA about trying to understand what people want and giving it to them. Netflix has that DNA.
  - DonHopkins 5y ago
    Netflix developed a game-like branching video about developing a virtual reality video game about a branching novel (Bandersnatch). They might also publish live videos of real people playing actual video games (Twitch).
brobdingnagians 5y ago
The odd thing is that each company wants to grow far above the average for the economy, which doesn't add up. Their entire reason for existence is "exponential growth", which can't exist in nature for very long. Greed drives underhanded tactics and rewards conniving. It would be better to be satisfied with a handsome profit and a good life with interesting problems to solve and contributions to ones community. That's the way to build a resilient society. Whatever we are building, I fear it isn't resilient.
- 1123581321 5y ago
  No, it does makes sense that the growth companies, and companies in a market that is rapidly changing, are expecting to grow faster than the economy. The rest of the economy is stable or in decline, which is how we end up with GDP of a few percentage points per year. It is indeed destabilizing to have overall GDP growth beyond a few percent but less so for select individual sectors to experience it. Greed is found just as much or more in stable industries. Belief that the pie is of a fixed size drives some craven behavior.
- Joeri 5y ago
  There is a fair argument to be made that whenever you see a company taking the lion’s share of a market, whether in customers or profit, you’re witnessing a form of market failure. A textbook healthy free market has enough competition that profits are low and the market is evenly divided between many entrants.
  - jhanschoo 5y ago
    This depends on the market, though of course it's not the case that a market would naturally tend to the best kind of competitive environment serving it. For example, there is an argument that markets with one incumbent among several competitors can serve a market better, since the incumbent will have profits through it's economies of scale with which it can reinvest into R&D to serve the market better, that it needs to maintain its incumbency.
  - jfengel 5y ago
    That leads to a different market failure: inefficiencies due to redundancy. The free market will, left to its own devices, become less free as the most efficient company dominates. It may buy up its competition or simply outcompete them. That will allow the same amount of goods for less money since the redundant overheads are eliminated. However, the ultimate end state of that is a monopoly, which frees them up to set prices wherever they want. In theory a new company could arise to undercut them, but in practice barriers to entry make that unlikely. So the free market is always in constant tension between healthy competition and unhealthy inefficiency. The balance of it depends on the ability to differentiate, customer choice, and external regulation -- as well as the overlapping dependencies from supply chains and nearby industries.
smt88 5y ago
If Netflix plans to compete with Stadia, they have plenty of reason to get into gaming. Netflix is already on TVs around the country. It makes sense for them to use that huge user base for games.
- CraneWorm 5y ago
  I am OOTL, is Stadia growing?
  - sofixa 5y ago
    There's no official numbers, but probably - it has gotten lots of new releases, including heavy hitters like Ubisoft and EA's catalogues, including their latest games. Coupled with the unavailability of some latest gen consoles ( PS5), the slow arrival and subpar experience on some competing cloud gaming platforms (Xcloud), it would make sense. On the other hand, Google's recent changes for better revenue sharing imply that things aren't going that great / great enough. In any case, Stadia is by far the best in terms of UX and lag among the competitors I've tried ( GeForce Now and Xcloud). If it weren't for Google's terrible reputation for abandoning stuff ( even if it isn't directly applicable here because Google rarely, if ever, kill paid services) they'd be doing much better IMHO.
  - nefitty 5y ago
    Maybe, but probably not as fast as Google was aiming for. There don’t seem to be any direct numbers from Google, but some sources have reported that they missed active user targets by “hundreds of thousands”. https://www.extremetech.com/gaming/320366-report-stadia-missed-active-user-targets-by-hundreds-of-thousands https://www.extremetech.com/gaming/320366-report-stadia-miss...
melomal 5y ago
Its literally why things like Solar Wind hacks happen with cost cuts. Also products become unfixable, you get locked-in, random shit happens that requires everyone to spend a little extra and so on. It always amazes me that people who adore the startup f-you mentality are shocked when they go public that this mentality fizzles out pretty quickly. Google & Facebook were adored as leaders in tech and now...
palg 5y ago
That maybe true but also no one thought their streaming idea was going anywhere either. I worked with telco/cable execs (comcast, verizon et al) back then, who would laugh at Netflix posing an issue. The internet wasnt cheap or fast in most parts of the world and content was locked up. But now we have blockbusters and live sports streaming that they used to categorically say would never happen. They might well fail in gaming or they might kill off the never ending amount of ads on Android gaming or cause Apple to hand over more cash to game devs. The only thing certain in this uncertain world is competition keeps everyone on their toes. And thats not always bad.
senko 5y ago
Without knowing the particulars of that specific company, this doesn't always hold true. Companies in this situation (handsomely profitable but little/no growth) can start issuing dividends (or share buybacks). True, they wouldn't be valued as a growth company any longer, causing a dip in the stock price, but that wouldn't necessarily mean continuous decline until oblivion.
usrusr 5y ago
Bane of the stock market: those who believe that a company will grow price in their projected growth expectations and will therefore always outbid those who believe that the company is well set up for stable profitability but maybe not so much for growth. In the end the company will have an ownership structure that would feel cheated by executives who don't aggressively prioritize growth over earnings and/or stability, because growth is what the current owners paid for. Not cutting up a golden egg laying goose seems to be a luxury that's effectively restricted to the privately owned. "I've paid so much for this goose, if we don't scale the golden eggs to factory farming I would have been better off buying bonds"

powerapple 5y ago

Video games could be a real good extension to their business. They have all the technology to deliver content to users, games are just another kind of content. I don't know how this can pan out, but I am excited for Netflix. I hope they have a plan to provide streaming games, and this is just a start.

gelert 5y ago
To offer a more pessimistic case this was true for Google, whose Stadia product flopped, and it was true for Amazon, whose video games utterly failed to take off. Currently something like Microsoft gamepass is a far better choice if you want to subscribe and play videogames. On another note, Netflix has experimented with videogames before using Telltale "choose your own adventure" style games and fitting them into their existing product. They also did a similar thing with Bandersnatch a choose your own adventure from the film side. So I think with the demise of telltale netflix might just be bringing that in house rather than trying to offer a wholesale alternative to existing videogame providers.
- sofixa 5y ago
  > To offer a more pessimistic case this was true for Google, whose Stadia product flopped Has it now? Their locations and games only keep growing, and the service is still their. Flopped is a bit harsh.
- p1necone 5y ago
  Yeah but Google made some stunningly poor decisions and have a very lacking game library compared to pretty much every single other streaming platform/console/steam/epic/gog/whatever. With their existing tech chops I don't think Netflix would have to try very hard to put out a significantly better service than Google did. "Pay $X a month for this not garbage library of games, play on any device capable of handling the video stream and a gamepad". (Yes I know Stadia have fixed a lot of these issues now, but they didn't for a long time, and it's too far past the initial hype unless they get no new competition for a long time). They also have a huge existing install base, stick the Gaming thing on the menu, advertise a trial, bam people are hooked. The crucial thing is to make sure there's some sort of connection quality test that pops up a "hey, your internet doesn't seem so hot - your experience might not be great, but hey have a go anyway it might be okay" message. Otherwise a huge chunk of the market is just going to assume the service is terrible and then talk on social media about how the service is terrible, and tank the product.
- bryanrasmussen 5y ago
  >To offer a more pessimistic case this was true for Google, whose Stadia product flopped I don't think that Google has ever shown any ability in pivoting if their first idea was not super successful. So they don't really have any business DNA about trying to understand what people want and giving it to them. Netflix has that DNA.
- DonHopkins 5y ago
  Netflix developed a game-like branching video about developing a virtual reality video game about a branching novel (Bandersnatch). They might also publish live videos of real people playing actual video games (Twitch).

brobdingnagians 5y ago

The odd thing is that each company wants to grow far above the average for the economy, which doesn't add up. Their entire reason for existence is "exponential growth", which can't exist in nature for very long. Greed drives underhanded tactics and rewards conniving. It would be better to be satisfied with a handsome profit and a good life with interesting problems to solve and contributions to ones community. That's the way to build a resilient society. Whatever we are building, I fear it isn't resilient.

1123581321 5y ago
No, it does makes sense that the growth companies, and companies in a market that is rapidly changing, are expecting to grow faster than the economy. The rest of the economy is stable or in decline, which is how we end up with GDP of a few percentage points per year. It is indeed destabilizing to have overall GDP growth beyond a few percent but less so for select individual sectors to experience it. Greed is found just as much or more in stable industries. Belief that the pie is of a fixed size drives some craven behavior.
Joeri 5y ago
There is a fair argument to be made that whenever you see a company taking the lion’s share of a market, whether in customers or profit, you’re witnessing a form of market failure. A textbook healthy free market has enough competition that profits are low and the market is evenly divided between many entrants.
- jhanschoo 5y ago
  This depends on the market, though of course it's not the case that a market would naturally tend to the best kind of competitive environment serving it. For example, there is an argument that markets with one incumbent among several competitors can serve a market better, since the incumbent will have profits through it's economies of scale with which it can reinvest into R&D to serve the market better, that it needs to maintain its incumbency.
- jfengel 5y ago
  That leads to a different market failure: inefficiencies due to redundancy. The free market will, left to its own devices, become less free as the most efficient company dominates. It may buy up its competition or simply outcompete them. That will allow the same amount of goods for less money since the redundant overheads are eliminated. However, the ultimate end state of that is a monopoly, which frees them up to set prices wherever they want. In theory a new company could arise to undercut them, but in practice barriers to entry make that unlikely. So the free market is always in constant tension between healthy competition and unhealthy inefficiency. The balance of it depends on the ability to differentiate, customer choice, and external regulation -- as well as the overlapping dependencies from supply chains and nearby industries.

smt88 5y ago

If Netflix plans to compete with Stadia, they have plenty of reason to get into gaming. Netflix is already on TVs around the country. It makes sense for them to use that huge user base for games.

CraneWorm 5y ago
I am OOTL, is Stadia growing?
- sofixa 5y ago
  There's no official numbers, but probably - it has gotten lots of new releases, including heavy hitters like Ubisoft and EA's catalogues, including their latest games. Coupled with the unavailability of some latest gen consoles ( PS5), the slow arrival and subpar experience on some competing cloud gaming platforms (Xcloud), it would make sense. On the other hand, Google's recent changes for better revenue sharing imply that things aren't going that great / great enough. In any case, Stadia is by far the best in terms of UX and lag among the competitors I've tried ( GeForce Now and Xcloud). If it weren't for Google's terrible reputation for abandoning stuff ( even if it isn't directly applicable here because Google rarely, if ever, kill paid services) they'd be doing much better IMHO.
- nefitty 5y ago
  Maybe, but probably not as fast as Google was aiming for. There don’t seem to be any direct numbers from Google, but some sources have reported that they missed active user targets by “hundreds of thousands”. https://www.extremetech.com/gaming/320366-report-stadia-missed-active-user-targets-by-hundreds-of-thousands https://www.extremetech.com/gaming/320366-report-stadia-miss...

melomal 5y ago

Its literally why things like Solar Wind hacks happen with cost cuts. Also products become unfixable, you get locked-in, random shit happens that requires everyone to spend a little extra and so on. It always amazes me that people who adore the startup f-you mentality are shocked when they go public that this mentality fizzles out pretty quickly. Google & Facebook were adored as leaders in tech and now...

palg 5y ago

That maybe true but also no one thought their streaming idea was going anywhere either. I worked with telco/cable execs (comcast, verizon et al) back then, who would laugh at Netflix posing an issue. The internet wasnt cheap or fast in most parts of the world and content was locked up. But now we have blockbusters and live sports streaming that they used to categorically say would never happen. They might well fail in gaming or they might kill off the never ending amount of ads on Android gaming or cause Apple to hand over more cash to game devs. The only thing certain in this uncertain world is competition keeps everyone on their toes. And thats not always bad.

senko 5y ago

Without knowing the particulars of that specific company, this doesn't always hold true. Companies in this situation (handsomely profitable but little/no growth) can start issuing dividends (or share buybacks). True, they wouldn't be valued as a growth company any longer, causing a dip in the stock price, but that wouldn't necessarily mean continuous decline until oblivion.

usrusr 5y ago

Bane of the stock market: those who believe that a company will grow price in their projected growth expectations and will therefore always outbid those who believe that the company is well set up for stable profitability but maybe not so much for growth. In the end the company will have an ownership structure that would feel cheated by executives who don't aggressively prioritize growth over earnings and/or stability, because growth is what the current owners paid for. Not cutting up a golden egg laying goose seems to be a luxury that's effectively restricted to the privately owned. "I've paid so much for this goose, if we don't scale the golden eggs to factory farming I would have been better off buying bonds"