Binge watchers worldwide know and love Netflix. The streaming platform has come a long way from the days of mailing customers DVDs. From being turned into the “Netflix and Chill” meme to producing original content with A-list celebrities, Netflix has become a cultural giant.
Now, like the Roman Empire, all things must come to an end. With close rivals at every turn and an array of options for consumers, Netflix may not be able to withstand phase two of the cord-cutting revolution.
In 2018, half of Americans age 22-45 reported not watching any cable TV. Over the last decade, more than 35 million Americans of all ages have joined the cord-cutting movement. Previously, these cable droppers had only one place to turn for content: Netflix.
Now, the streaming landscape looks far different.
In 2010, Netflix cemented itself for a wild upward ride by purchasing rights to content from Disney, NBC, and Fox. By capturing TV shows like “The Office,” and movie franchises like “The Avengers,” Netflix gave consumers everything they wanted.
While the interests of consumers haven’t changed, the competition has. Now, Hulu gives viewers another streaming option. Meanwhile, entertainment companies like NBC and Disney are creating streaming services. That means they are taking their content with them.
Thus begins phase two of cord-cutting.
Over the past three years, the top three bestselling movies have all found their way onto Netflix (not including 2019’s). However, they all belong to Disney. Come November, when Disney+ launches, they will all disappear. To make things worse, the new service will cost just $6.99 a month—a huge discount to Netflix’s $12.99 monthly price tag.
In the wake of this loss, Netflix remains without its best-performing content. As phase two continues, many more entertainment companies are likely to follow. As such, it wouldn’t be surprising if, in a few years, Netflix only streams its original content and a handful of indie productions.
To try and keep up, Netflix spent $12 billion on original content last year, with plans to spend another $15 billion this year. Consequently, the debt the platform now holds is more than ten times greater than its yearly profits.
Despite its massive spending, there’s no way Netflix can compete with the beloved franchises and shows it will no longer be able to stream.
Survival is Key
Although the outlook is grim, Netflix currently has a massive subscriber base of 149 million people. As it loses content, this number is going to decline sharply. However, the streaming service isn’t going to vanish.
There are still plenty of people that are willing to pay for yearly “Stranger Things” binges and a vast library of stand-up comedy specials. They will also likely continue to embrace adaptations of hits like “Black Mirror” and new, interactive choose-your-own-adventure style shows.
Over the next few years, Netflix is undoubtedly going to change dramatically. With less influence and more competition, things will be harder for the grandfather of streaming. The company will likely survive. However, it may only be a shadow of what it once was. Meanwhile, competitors will have their opportunity to shine in a crowded market.
One thing is certain, though; viewers will never forget the many happy memories and endless hours in which Netflix has entertained them. And yes, we are still watching.