6 ms·

When Netflix first started, they were able to buy the streaming rights to old movies and TV shows for cheap, because executives thought they weren't worth anyth

by fsk 11y ago

When Netflix first started, they were able to buy the streaming rights to old movies and TV shows for cheap, because executives thought they weren't worth anything. Now those contracts are expiring, and the studios want to jack up the rates or start their own service. Netflix is also getting squeezed by ISPs like Comcast, who want to charge them for the right to deliver video to Comcast's customers who already paid for their bandwidth. So Netflix' only way to survive is to develop its own content. If it's dependent on other people to provide content, they'll jack up their prices to take Netflix' profit margins. So now you have 5-10 competing services, and if you aren't paying attention, you don't know what shows are available on what service. Meanwhile, if you go to a file-sharing website, you can get every single show and movie. So Netflix (and its competitors) have less compelling of a value proposition, if you have to pay $10/month to several different services to get all the shows you might want to watch.

sriramk 11y ago
You mean when Netflix streaming started - they've been around for a long time doing DVDs :).
- digitalzombie 11y ago
  And took down BlockBuster.
- panglott 11y ago
  I don't understand why people forget they have the DVD business. That's why I subscribed, and I've always been a subscriber. Everything comes out on DVD eventually, so you can watch almost anything through Netflix if you're willing to wait. And there's plenty of media there to fill the time.
  - TheGRS 11y ago
    Its still a good service and their ability to turn around disks so quickly was a huge advantage to them for years. They wisely realized, however, that the DVD business would die slowly and got very competitive about streaming. I'm sure you can enjoy the dvd mailing for at least a few more years before they begin closing those large warehouses down one by one.
  - soylentcola 11y ago
    I guess what it often comes down to for me is that I don't really need a video rental store (online/shipping or brick and mortar) too often. For the one or two movies I consider "must see" each year, I go to the theater. For the ones that I still definitely want to check out later, there are on-demand streaming rentals that allow me to decide what to watch and have it there immediately. Then as films get farther and farther from their release windows, they turn up on HBO or Netflix streaming, etc. It's just a smaller niche for me between wanting to see it at release and not caring when I get around to watching it. Since Netflix added streaming it's essentially taken the place of basic cable for me (rather than replacing Blockbuster). With basic cable you can't always count on something being on at a given time but you can usually skim through the options and find something enjoyable. That's how I am with Netflix. The only difference is that Netflix costs $10/mo whereas basic cable costs $50+. I like the fact that a company is managing to compete with cable networks without actually being a (traditional) cable network. Their shows may not always beat the best of HBO but they sure as hell beat USA, TBS, and the long list of "random shows and movies" cable channels.
  - untog 11y ago
    I don't understand why people forget they have the DVD business. Presumably because it is becoming a smaller and smaller part of their business. That's the reason they wanted to spin it off as Quikster. DVD rental also isn't available on the subscription package that most users have.
TD-Linux 11y ago
Don't forget the rather oppressive DRM required by Hollywood for 4K video content. This is why 4K is currently only available for Netflix original content.
- praseodym 11y ago
  And even then, 4K is only available on a limited number of devices (TVs and some set top boxes); not from a regular web browser. https://help.netflix.com/en/node/13444 https://help.netflix.com/en/node/13444
- anigbrowl 11y ago
  It's optional, but most producers choose it despite the additional financial overhead, because otherwise it becomes much more expensive to audit which theaters played your movie and how often in order to get paid. Obviously it's not just theaters any more but they're most likely to have 4k gear, in terms of both display and fat pipes. 4k is basically the industry-standard output format* so if there's no DRM then downstream distributors have an enormous economic incentive to rip the originator off by serving up that very high-quality copy for the highest price they can get and pocketing all the ticket sales revenue for themselves. Very basically, rental of a film for a cinema for a day is $250 or 35% of ticket sales, whichever is more (the flat rate is less over long periods, the 35% stays the same). 2 hours of 4k UHD video in the ProRes codec (which will play back smoothly on a regular computer, with good enough quality that most people wouldn't notice the difference) is about 700gb. A fast 1tb drive in an enclosure is under $200, so if the film is even moderately popular and would benefit from being presented on a large screen (which most films of any quality certainly do), then it becomes very tempting for exhibitors to make a copy, either for display or to produce knockoffs in disc form (which will be fully competitive with the 'official' version as far as audio/video quality goes). * Technically there's DCI 4k and Ultra-HD, with the former being slightly higher resolution than the latter - see http://www.extremetech.com/extreme/174221-no-tv-makers-4k-and-uhd-are-not-the-same-thing http://www.extremetech.com/extreme/174221-no-tv-makers-4k-an... but they're close enough that even camera people lump them otgether as '4k' and the 10% shortfall on UHD gear is not considered that bad of a loss. If you're very concerned about horizontal resolution chances are you're using anamorphic lenses anyway.
testingonprod 11y ago
Speaking of exclusive content, I highly highly recommend Netflix's "Daredevil" (a TV series they developed with Marvel). It's seriously some amazing content.
- thaumaturgy 11y ago
  Seconded. The fight choreography and photography are as good or better than John Wick if you're into that sort of thing. That hallway fight scene was amazingly well done. The casting is quite good too. (Although the actor could learn a couple of things from Chris Gorham, who did a really great job of playing a blind guy on Covert Affairs.)
  - mercurial 11y ago
    Thirded. Another thing that sets it apart from other superhero shows is that how, after a while, the series spends time showing the main villain, who gains a human dimension.
    - alessioalex 11y ago
      Forded? The show is pretty damn good. House of Cards is amazing as well.
  - moomin 11y ago
    Most actors could learn a couple of things from Chris Gorham. I still miss Jake 2.0. (Although his blind act was much weaker in the first season...)
- EnderMB 11y ago
  I've only watched a handful of their shows, but I'm yet to watch a Netflix show that isn't great. House of Cards is fantastic, Daredevil as you say is amazing, Bojack Horseman is hilarious, and Unbreakable Kimmy Schmidt is a breath of fresh air.
  - mreiland 11y ago
kiba 11y ago
So big media created their own competitor by jacking the price up for netflix. Oops.
- rhino369 11y ago
  Netflixs growth forced the issue. Cable can't run on original, first run content alone. There is so much content that is on Netflix that it doesn't matter that it is all reruns. Netflix would destroy the networks but also their main suppliers. That is why Netflix is going into original content. If they won't fund it nobody will.
- fluidcruft 11y ago
  Netflix isn't a studio--they still buy their shows from the same production companies.
r00fus 11y ago
No kidding about Comcast - Streampix? Talk about derivative naming. And it's priced to kill Netflix at $5/mo for cable subscribers. I'm not so sure about the pirating scene - while big content providers likely will never kill it, they seem to have lawmakers in their pockets, and so will criminalize it as much as possible - expect draconian measures to destroy the most dangerous threat to big content providers.
- jimbobimbo 11y ago
  Every time I login to pay my Xfinity bill, I pause, because their website looks like a carbon copy of Netflix.
- whichfawkes 11y ago
  Just like the drug market with all its weird research chemicals that are technically legal, I'm pretty sure the piracy scene can move faster than draconian measures can take them down. It's hard to compete with free. At the moment, Netflix does a pretty good job. HBO might too if they can fully disentangle from cable. If prices get higher, or the content individuals want gets spread across too many streaming services people will watch less and/or pirate more.
Eye_of_Mordor 11y ago
Alternatively, you stop watching movies and do something else?
rayiner 11y ago
It's the inevitable market dynamic for a company like Netflix. They're a middle-man--the sell Sony's content, hosted on Amazon's servers, over Comcast's wires. Their business model lives and dies by what value they can add to that chain. Don't get me wrong, I like Netflix. I don't have cable TV (and now that HBO Now exists, I don't plan to). But I've got Netflix alongside Hulu and Amazon Prime, and I see them as pretty fungible. Getting a good browsing/steaming UI together isn't rocket science, and all three are fine. The original content is the only thing that makes Netflix a "must have" for me.

by fsk 11y ago

sriramk 11y ago

You mean when Netflix streaming started - they've been around for a long time doing DVDs :).

digitalzombie 11y ago
And took down BlockBuster.
panglott 11y ago
I don't understand why people forget they have the DVD business. That's why I subscribed, and I've always been a subscriber. Everything comes out on DVD eventually, so you can watch almost anything through Netflix if you're willing to wait. And there's plenty of media there to fill the time.
- TheGRS 11y ago
  Its still a good service and their ability to turn around disks so quickly was a huge advantage to them for years. They wisely realized, however, that the DVD business would die slowly and got very competitive about streaming. I'm sure you can enjoy the dvd mailing for at least a few more years before they begin closing those large warehouses down one by one.
- soylentcola 11y ago
  I guess what it often comes down to for me is that I don't really need a video rental store (online/shipping or brick and mortar) too often. For the one or two movies I consider "must see" each year, I go to the theater. For the ones that I still definitely want to check out later, there are on-demand streaming rentals that allow me to decide what to watch and have it there immediately. Then as films get farther and farther from their release windows, they turn up on HBO or Netflix streaming, etc. It's just a smaller niche for me between wanting to see it at release and not caring when I get around to watching it. Since Netflix added streaming it's essentially taken the place of basic cable for me (rather than replacing Blockbuster). With basic cable you can't always count on something being on at a given time but you can usually skim through the options and find something enjoyable. That's how I am with Netflix. The only difference is that Netflix costs $10/mo whereas basic cable costs $50+. I like the fact that a company is managing to compete with cable networks without actually being a (traditional) cable network. Their shows may not always beat the best of HBO but they sure as hell beat USA, TBS, and the long list of "random shows and movies" cable channels.
- untog 11y ago
  I don't understand why people forget they have the DVD business. Presumably because it is becoming a smaller and smaller part of their business. That's the reason they wanted to spin it off as Quikster. DVD rental also isn't available on the subscription package that most users have.

TD-Linux 11y ago

Don't forget the rather oppressive DRM required by Hollywood for 4K video content. This is why 4K is currently only available for Netflix original content.

praseodym 11y ago
And even then, 4K is only available on a limited number of devices (TVs and some set top boxes); not from a regular web browser. https://help.netflix.com/en/node/13444 https://help.netflix.com/en/node/13444
anigbrowl 11y ago
It's optional, but most producers choose it despite the additional financial overhead, because otherwise it becomes much more expensive to audit which theaters played your movie and how often in order to get paid. Obviously it's not just theaters any more but they're most likely to have 4k gear, in terms of both display and fat pipes. 4k is basically the industry-standard output format* so if there's no DRM then downstream distributors have an enormous economic incentive to rip the originator off by serving up that very high-quality copy for the highest price they can get and pocketing all the ticket sales revenue for themselves. Very basically, rental of a film for a cinema for a day is $250 or 35% of ticket sales, whichever is more (the flat rate is less over long periods, the 35% stays the same). 2 hours of 4k UHD video in the ProRes codec (which will play back smoothly on a regular computer, with good enough quality that most people wouldn't notice the difference) is about 700gb. A fast 1tb drive in an enclosure is under $200, so if the film is even moderately popular and would benefit from being presented on a large screen (which most films of any quality certainly do), then it becomes very tempting for exhibitors to make a copy, either for display or to produce knockoffs in disc form (which will be fully competitive with the 'official' version as far as audio/video quality goes). * Technically there's DCI 4k and Ultra-HD, with the former being slightly higher resolution than the latter - see http://www.extremetech.com/extreme/174221-no-tv-makers-4k-and-uhd-are-not-the-same-thing http://www.extremetech.com/extreme/174221-no-tv-makers-4k-an... but they're close enough that even camera people lump them otgether as '4k' and the 10% shortfall on UHD gear is not considered that bad of a loss. If you're very concerned about horizontal resolution chances are you're using anamorphic lenses anyway.

testingonprod 11y ago

Speaking of exclusive content, I highly highly recommend Netflix's "Daredevil" (a TV series they developed with Marvel). It's seriously some amazing content.

thaumaturgy 11y ago
Seconded. The fight choreography and photography are as good or better than John Wick if you're into that sort of thing. That hallway fight scene was amazingly well done. The casting is quite good too. (Although the actor could learn a couple of things from Chris Gorham, who did a really great job of playing a blind guy on Covert Affairs.)
- mercurial 11y ago
  Thirded. Another thing that sets it apart from other superhero shows is that how, after a while, the series spends time showing the main villain, who gains a human dimension.
  - alessioalex 11y ago
    Forded? The show is pretty damn good. House of Cards is amazing as well.
- moomin 11y ago
  Most actors could learn a couple of things from Chris Gorham. I still miss Jake 2.0. (Although his blind act was much weaker in the first season...)
EnderMB 11y ago
I've only watched a handful of their shows, but I'm yet to watch a Netflix show that isn't great. House of Cards is fantastic, Daredevil as you say is amazing, Bojack Horseman is hilarious, and Unbreakable Kimmy Schmidt is a breath of fresh air.
- mreiland 11y ago

kiba 11y ago

So big media created their own competitor by jacking the price up for netflix. Oops.

rhino369 11y ago
Netflixs growth forced the issue. Cable can't run on original, first run content alone. There is so much content that is on Netflix that it doesn't matter that it is all reruns. Netflix would destroy the networks but also their main suppliers. That is why Netflix is going into original content. If they won't fund it nobody will.
fluidcruft 11y ago
Netflix isn't a studio--they still buy their shows from the same production companies.

r00fus 11y ago

No kidding about Comcast - Streampix? Talk about derivative naming. And it's priced to kill Netflix at $5/mo for cable subscribers. I'm not so sure about the pirating scene - while big content providers likely will never kill it, they seem to have lawmakers in their pockets, and so will criminalize it as much as possible - expect draconian measures to destroy the most dangerous threat to big content providers.

jimbobimbo 11y ago
Every time I login to pay my Xfinity bill, I pause, because their website looks like a carbon copy of Netflix.
whichfawkes 11y ago
Just like the drug market with all its weird research chemicals that are technically legal, I'm pretty sure the piracy scene can move faster than draconian measures can take them down. It's hard to compete with free. At the moment, Netflix does a pretty good job. HBO might too if they can fully disentangle from cable. If prices get higher, or the content individuals want gets spread across too many streaming services people will watch less and/or pirate more.

Eye_of_Mordor 11y ago

Alternatively, you stop watching movies and do something else?

rayiner 11y ago

It's the inevitable market dynamic for a company like Netflix. They're a middle-man--the sell Sony's content, hosted on Amazon's servers, over Comcast's wires. Their business model lives and dies by what value they can add to that chain. Don't get me wrong, I like Netflix. I don't have cable TV (and now that HBO Now exists, I don't plan to). But I've got Netflix alongside Hulu and Amazon Prime, and I see them as pretty fungible. Getting a good browsing/steaming UI together isn't rocket science, and all three are fine. The original content is the only thing that makes Netflix a "must have" for me.