Netflix's stock price has been dropping significantly in recent days and weeks. Just in November it was trading between $650 and $700. Now it is trading at around $360. That is almost 50% drop in its stock price. I haven't paid attention to any specific news about Netflix what might be the reasons. But we know many stock market overall has been in decline. Even crypto market and bitcoin has seen big drops in prices recently.
Netflix has been a very successful company and facilitated the transition from traditional ways of watching movies, documentaries, and tv shows to online streaming. It has been a pioneer in this space and was able to recognize the shift that was about to happen with fast moving technological advancement. If it wasn't Netflix, it could have been another company that would serves as a catalyst in this shift to online streaming instead of using cable tv subscriptions and renting DVDs. This just shows once again how having a vision of things to come play important role in building successful companies.
I really like Netflix as company and the services they offer. I think/hope this price drop will be temporary and it will continue making its investors profitable. Many who invested in Netflix made good decisions. I doubt it is time for Netflix to decline as business, even though they have many more competitors today than years before.
I have been subscribed to Netflix for a while. I don't remember how much I even pay. It is deducted automatically, and I have checked in a while how much I have been paying them. Recently, I have read somewhere that Netflix was raising its subscription fees again. I don't really care. I trust they will make smart business decisions, and I am not planning to cancel it anytime soon.
However, this is not the case with my other online streaming subscriptions and services. I normally do not like to waste money and pay for services I do not use anymore. Today, there are many more streaming services Disney plus, HBO plus, Showtime, Apple TV plus, Paramount plus, AMC, Amazon Prime, Hulu, and others. I have used most of them at different times. When I realize any of them is no longer needed, I cancel them until there is a need to subscribe again.
I do not plan on cancelling Netflix. I am impressed with what they offer, how they operate their business. Let me explain why I am impressed with Netflix business decisions.
I admire innovators and visionaries that bring about new things and making things better for people. In the past we had no options but to use services of monopolies like Comcast and in return likes of Comcast wouldn't do anything to improve services but keep increasing their fees. Such companies would even split up regions amongst themselves so that they wouldn't have to compete. Netflix was the competition none of them expected. Many people have moved to online streaming services and stopped using services like Comcast cable. I think it is a win.
One of Netflix's clever business models was to offer DVDs in mail along with streaming services. I was surprised to find out they still have DVD mailing service as a separate subscription. I thought they went fully online streaming and stopped mailing DVDs. Apparently, there is till an option to receive DVDs in the mail. Offering this service, they were providing people with something they were already familiar with and compatible with their devices at home. This also added convenience of not traveling to video rental stores, and offered good collection of movies and tv shows. I believe this helped them with onboarding masses to their streaming platform.
One of the best decisions they have made is, using zero ads. No ads, period. Some of the other streaming services are still struggling with this decision. Hulu was one of the first competitors to Netflix. Hulu used to offer subscription and still show ads. I am not sure if they still do that or not. Netflix has proven that it is possible to be build a business and be profitable without relying on ads money. I think it is time for ads to go.
Another great move by Netflix was/is that when they offer TV Series to watch, they give all episodes at once and let the viewers to decide when to watch. This was something new and many liked it. Even today some streaming services offer only one episode a week, just like before. I can understand some of these services still have network tv agreements, some of them are aired on certain channels before they are available for streaming, etc. But there are services like Apple TV plus that continue the same practice. I do not think tv shows on Apple TV plus are aired on tv. Correct me if I am wrong.
Apple is one of the latest players in streaming space. They started their Apple TV plus subscription services. They have smaller collection of movies and tv shows available. But they do have some very good movies and tv shows though. One of the shows on Apple TV plus is See, and I remember they only showed one episode a week. I don't understand their decision here. Maybe that's how they try to retain users. Maybe they think if they offer the entire season at once, people will watch in a week or a month and cancel?
Few years ago, it was obvious that competition was coming and others would figure out the streaming technology and perhaps Netflix would be in trouble. Well years has passed, many services emerged, but somehow it doesn't look like Netflix is in trouble at all. In fact, they are stronger than ever. Next brilliant move by Netflix was to order production of movies and series for Netflix, only for Netflix. That was a bold and expensive move when they started doing it. Now they have huge collection and new movies and series are being produced added to their library every month.
They grew big enough that they don't have to rely on Hollywood to dictate their terms of licensing what they produce. Now Netflix is in a position to dictate its own terms. Impressive!
Netflix is great. But I also like other services too. Second closest one would probably be Paramount plus. It used to be a CBS app. I think that changed last year. They have a good collection too. I doubt they will ever be a competition to Netflix. When they first released their app, it has all kinds of problems. I think it still has bugs. But they do have some good tv series.
What are your favorite streaming platforms? What do you think about Netflix? Share your thoughts in the comments.
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I absolutely agree with you on how brilliant Netflix is! I have actually tried only HBO but got fed up with it and cancelled it after I finished watching Westworld. I haven't seen the latest season but I hear it's kinda crap so I'm not subscribing there again. I liked Beforeigners too but I've heard that the new season is crap too so again, not bothering. :D
Although I think I don't have that much time to watch anything, I do watch something every day. If not from Netflix then from Finnish national tv = YLE (streaming service called Areena) that has such a vast variety of documentaries (I mostly watch science, history and culture documentaries) and British period dramas and other really excellent British series. Areena is free, or isn't actually, every Finnish person pays for it in taxes. Except those with lower income, not quite sure what the limit is but I think it's quite fair, so for those with low income it's free. Unfortunately https://areena.yle.fi/tv can only be seen in Finland and I hear YLE has blocked all VPN access to Areena. But I love how much there is good, quality documentary there. For instance I've seen every Louis Theroux documentaries from YLE and he's one of my favorite documentarists.
But yeah, back to Netflix. Sometimes it bugs me. Not that much lately but for a long time it was really hard to find anything new or old to watch that I haven't seen as it always suggested movies and series I've already seen or stuff that I don't even want to see. But something changed like a month ago. Now the suggestions are better. It no longer is fixated on certain top list or most watched stuff but actually seems to shuffle the pack a little or more, depending on how long I've been away. Like two hours or 24... :D I'm not an addict... nooooo...
And don't get me started on the period when Netflix dubbed all trailers or clips. I never watch anything dubbed, unless I'm drunk or suffer from a stoke in which I can no longer read the subtitles, so why would I want the clips to be dubbed. It's horrible.
I think Netflix really has so vast variety of different kind of series and movies there that I don't need anything else. Except YLE Areena, but that really is superior, in documentaries especially, so I usually rarely watch the documentaries in Netflix. And I love it how reality shows mostly isn't a thing in Netflix, or they have figured out not to suggest those for me because I absolutely hate reality shows.
I love watching series one episode a day. Usually before I go to sleep. And I would hate it if I would be forced to wait one week, just like watching normal TV which I don't actually watch anymore. But there are few exceptions. I don't know if it's in all regions but new episodes of Snowpiercer started again and it's only one episode a week! Agony! And I just finished Ozark so I guess I have to find something else for the rest of the week.
I didn't know there was a Snowpiercer series. I liked the movie. Is it on Netflix?
Another great business move Netflix made attracting global audience and creating a platform for movies and series from around the world. Korean movies and series have been a great success.
Yes, it's on Netflix. But the Snowpiercer series might be a regional thing, not sure. Just like I know in some regions there's the movie Parasite but not here in Finland which is a bummer. But I think it'll be available here some day.
I love most Korean movies/series. #Alive was funny and entertaining. Of course watched Squid Game, it was okay and entertaining enough and Hellbound was really freaky and odd and scary, which I love.
If you like war movies/series and if Unknown Soldier (a Finnish series based on a book about the second world war) is visible in your region, I absolutely recommend that.
Give it 5-6 years and to watch what you want you will need 30 subscription services and cable.
Probably even sooner than that. There is already a dozen of them. I wonder if some of them will have to join more successful ones though. It must be expensive to run these services.
There decisions have taken them up the movie map and made them the top dog.
I actually don't have a subscription to Netflix but it's so obvious that Netflix has beaten all rivals to stay on top.
Just like the market, their prices would still go up because word on the street is everyone wants a bit of Netflix because they have proven to be trusted for you and many others.
I think that netflix will be the most likley to survive this streaming wars even though their product has been an obvious decline to try and keep up and generate their own IP as other production houses want more money to stream their content. I can't be sure but the other 5 don't seem like they will survive.
Perhaps apple will keep theres going even if its a loss the same with amazon, the only real competitor I think is Disnely+ with Hulu
Apple has a good start. They used to offer one year free service if you purchased new Apple TV or other Apple device. They might still be doing that. Even though their selection is not huge, they do have really decent series. They subscription is not that expensive too, I think $6 a month. If they continue focusing on quality, they may do well in this space too. Especially with the userbase the have built already, why not?
I particularly like Netflix's stand-up comedy lineup. They have all the big stars, and I have enjoyed many specials.
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Netflix for sure is #1 and i mean wayyyyyyyyyyyy in front. I don't watch individual stocks, but yea, now might be the time to buy some.
I remember getting DVD's in the mail.. I watched the who dragonball Z series from netflix. :P
No doubt Netflix keep me hooked more often...than any other. The choice of series are far better than other....we do have competitor in Amazon , Sony or others but this stands far ahead than it's competitor.
Does Sony have their own streaming platform?
Yes....it's called SonyLIV where we can watch TV shows, movies, sports or web series.....
I had no idea they still did the CD service. That's actully pretty cool kind of brings back those old memories and good times.
I have to say out of them all I like Netflix the most. They seem to bring out their own good shows and while not all are a huge hit they have had a number that I would say out perform the junk that has been hitting the movie theaters lately.
I feel like what they are lacking however are series that people want to stay subscribed for. It's going to start coming down to each of these streaming platforms to release their own blockbuster hits to keep subscribers around and I see people bouncing back and forth between them.
They also did just jack up their prices by about 10% but I guess that's pretty normal here with our hyper inflation.
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Yes, 10% increase is actually not bad indeed.
we just binged "Better Call Saul" on Netflix. Season 5 was not available so had to bite the bullet and buy season 5 on Amazon.
Was also happy to have Ozark back on Netflix as well. Overall it's my favorite.
I will usually take up Hulu on there quarterly offer to use their service for 30 days and then not sign up for any paid service haha. But their selection is not very good or as comprehensive at Netflix's
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For some reason I don't like Hulu. From the very start they had strong focus on commercials.
Netflix is definitely a great streaming platform especially in my country where Netflix is the most affordable one, and I enjoy some of their movies, so not really bad at all to get Netflix. It would just be a problem in the long run since it's not every day that they have new releases 🤣
But so far they are doing great!
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I didn't know they had different fees in different countries. How much does a regular subscription cost in your area?
It would take about $12. I am not sure how much in other countries though.
Though there is one for $3 but only for phones or tablets.
This is the biggest problem with the global economy. The bad wealth distribution. While some people can throw away who knows how much money on practically unnecessary things, many people are struggling with day to day living. I live with multiple disabilities, nowadays under the local minimum wage in Hungary, and normally paying rent/bills and buying food is a challenge. Not this winter, because the Hive blockchain helped me. But without the Hive blockchain, probably I would be homeless again.
Of course this is not your bad. I just like to shed light on the huge differences. Maybe the people, more specifically the EU will wake up, and will stop the financial discrimination in Hungary.
By the way, our currency is so worthless that even a seemingly very small (less than a cent) price increase/decrease can make visible differences in the local prices. 1 Hungarian Forint (HUF) is currently only $0.0031 USD. One cent increase/decrease in the price of the products can make a difference in who can afford it to buy, and who cannot. The minimum pension in my country is 28 500 HUF (currently $89.44 USD) per month. This was not changed in the previous 15 years. Nowadays I receive a pension-like income of approximately $250 USD per month. And many people live (survive) on much less. Nowadays I also work in a four hours per day packaging part time job, but my total income, which is approximately $470 USD per month, still does not reach the local minimum wage, which is approximately $550 USD per month.
Wake up Hungary, wake up EU, wake up USA, wake up world.
Have a nice day. All the best. Greetings and much love from Hungary.
I know you didn't address that to me, but was speaking in general. Just to clarify though, I don't have extra money to waste. I normally try to keep track of expenses and cancel unnecessary ones. I was just trying to point out the fact, that Netflix has built a trust and loyalty among its customers. It is a difficult thing to achieve for any company.
Your thoughts on wage inequalities are interesting. I remember talking to you on this subject before. It will be interesting to make a study of how much would be a decent wage across European countries and then other continents.
I think there will be much more correction for such stocks after March when the FED increases the policy rate (Not A Financial Advice)
Everybody is obsessed with what Fed is going to do lately. I think Fed's actions don't have much of an impact anyway. It's just market makers and specialists playing the news. I might be wrong. But if market crashes and we get another global financial crisis, I think it will be because it was long over due and got interrupted with pandemic. And it won't necessarily be because Fed decided to increase rates.
I prefer not to pay for subscription services and there really isn't anything interesting enough to force me to. As for Netflix, I think it will definitely go down due to all the competition. They need to stay competitive and nobody really wants to pay like 10 different platform subscriptions so numbers will definitely go down. At the same time the user base is going down, they are forcing higher prices so I don't have a good opinion of their company.
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The no commercials model is one of the biggest draws to streaming sites for me. Cable TV is basically unwatchable in my opinion. 27% of your time is spent viewing adds. It's literally just a waste of life and given that cable is usually 2x or 3x or more the price of streaming sites, it doesn't make sense to me. If Netflix added commercials I would probably drop it immediately. I'm finding that I need TV less and less nowadays and there is no way I could go back to watching commercials. I'm sure they will add them eventually though, it's just a matter of time. Gotta chase those profits.
Yes, commercials are the worst. :)
I doubt they will add commercials. I think they have figured out a better way.
That reminds of craigslist.org, how even when they became a popular platform they refused to place ads on their website even-though they knew they were missing out on a lot of money.
I hope that you're right.
I love how this articles borders on dicision making , inovation and starting out quick. It reminds me of the crypto journey of not just being a walk of luck but a field whose results are determined by your dicisions, how inovative you are supposed to be on timing and where you place your money. Above all just getting in and following the rabit hole as you but in work and not waiting on whatever is happening on the macro and micro
Netflix no doubt have been a successful company but I believe they will bounce back in making more profit
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Interesting article.great work,keep it up 👌
Great article!!
“One of Netflix's clever business models was to offer DVDs in mail along with streaming services. I was surprised to find out they still have DVD mailing service as a separate subscription. I thought they went fully online streaming and stopped mailing DVDs. Apparently, there is till an option to receive DVDs in the mail. Offering this service, they were providing people with something they were already familiar with and compatible with their devices at home.” I know little about Netflix , I’m actually just getting to know about this feature it has. Quite thoughtful on their part, its more or less bridging the gap between the past and the present. Any video streaming platform trying to rival Netflix right now must really do a lot and the most because the bars and standards set are really on the high side.
I think the best days of Netflix are over
because customers now have more choices
than they had in Netflix's best days, u know? 🧠