Netflix is dead
Since the fall of Blockbuster and home rental movie stores, a new phenomenon took over, allowing users to watch movies and TV shows at the click of a button.
Netflix has taken over our lives, making binge-watching a new norm. It has become a global force, a renowned brand.
On a practical side, Netflix managed to expand their brand across a number of countries around the world, becoming a force to be reckoned with and challenging established networks to be named the biggest and best in the world.
Netflix’s brand expanded exponentially, with shows like House of Cards and Narcos being completely commissioned by them.
Playing a big part in their advertising strategy, Netflix saw themselves at the heart of memes with the proverbial ‘Netflix and Chill’ slang growing in popularity.
What started out as an exclusive to America has now found a home in 190 countries, taking over the way people entertain themselves.
Over the last few years, Netflix have expanded their brand. Not only do they stream hundreds of films and TV shows, they now produce their own to varying success.
Netflix’s first self-commissioned original content series was House of Cards, released in 2013, and the company has dramatically grown its original content since that time.
Netflix now has 43 original drama shows. Among those we have Orange is the New black, Stranger Things, Marco Polo, 13 Reasons Why and many more.
Furthermore, Netflix have included original series, specials (including stand-up comedy specials), miniseries and documentaries to their already-massive virtual library.
In numbers :
Netflix consumes 15% of the world’s global internet traffic, according to Fortune Magazine.
Following Netflix, miscellaneous video embeds on websites takes up 13.1% of all internet traffic, while YouTube takes up 11.4% and general web browsing takes up 7.8%.
With 158 million subscribers, Netflix is a force to be reckoned with.
The company is currently raising another $2 billion in debt to fund additional content creation and other expenses, the company announced on October 21st, 2019.
So how’s Netflix “dead”?
Well, the answer can be found in one of the aforementioned stats: YouTube takes up 11.4% of all internet traffic !
YouTube doesn’t spend a dime on production. They only pay the creators who are successful enough to drive traffic.
What does that mean ?
It means YouTube has found a loophole in the world of content creation, and a way to exploit it thoroughly.
Netflix invests to drive more traffic and keep its subscribers, YouTube doesn’t.
While Netflix can’t fund some of its very costly shows (i.e. Marco Polo), YouTube lets creators fund their own projects (for most part), build their own audiences and waits till they take off to pay up.
To put that in numbers, there are 400 hours of video uploaded to YouTube every minute !
If your content doesn’t meet YouTube’s audience preferences, YouTube won’t suffer in any way.
As of 2019, YouTube is the world’s second largest search engine and second most visited site after Google.
YouTube also has 2 billion monthly users, while Netflix had over 158 million paying streaming subscribers worldwide in the third quarter of 2019.
The difference between the two giants is that YouTube makes money through not only subscriptions, which is their new somewhat ineffective way to make money, but mostly through ads.
Netflix doesn’t.
YouTube offers a variety of shows, vlogs, podcasts and educational experiences and channels whereas Netflix is all about “basic” entertainment.
YouTube is so much more diverse, and unlike Netflix, YouTube allows everyone to chime in on things, and if we’ve learned anything from Facebook, it’s that people love interacting with each other.
Case in point, one of the most entertaining aspects of Twitter is the possibility to react to different events while they’re still happening. On a platform like YouTube, you can do just that in the comments section. We saw that in full force when they began broadcasting the presidential debates on the platform.
Oh yes, that’s another thing YouTube offers : live broadcasting.
YouTube is much more complete as a platform. It’s free (sort of), and could eventually kill Netflix because all the traffic is being directed to it.
People are already spending huge chunks of their time on YouTube, and so do brands.
On the other hand, virtually no one is promoting anything on Netflix, and therein relies their dependence on subscriptions.
The verdict :
Netflix’s audience keeps growing, so it may not be time to panic yet. However, Netflix needs to avoid the status quo by finding new ways to generate revenue all while remaining relevant.
Exclusivity may be their secret sauce, but with Hulu, Prime, Apple +, HBO max, Disney Plus and many other platforms emerging, the fight for our attention may have just begun.
Netflix will have to find a new way to monetize because YouTube is coming for them, and will eventually take over.
How much time do you spend on YouTube ?
Which of the two is your go-to app ?
Let me know in the comments below !
