When Americans Reed Hastings and Mark Randolph founded a DVD movie rental company called Netflix 25 years ago, No one could have imagined that this company would accumulate so much capital. $36 billion For the distribution of audiovisual material.
Hastings often tells a story that angers the origins of the world’s leading streaming platform right now after he was fined $30 for the late return of “Apollo 13” tapes to his trusted video store.
The reality is that even before Netflix was created on August 28, 1997, Hastings was already considering the idea of opening a home VHS movie service.
The rise of DVD, an initial catalog of nearly a thousand titles, and the ability to release films a week later shaped a business idea that has evolved over the past few decades into a giant with over a become. 11,500 employees.
While it’s true that there were two features that set Netflix apart from its originals, the ability for its subscribers to pay a $20 monthly subscription to keep the DVDs for weeks and watch them more often, either in full or as part of the series. Possibility to pick up the season. ,
“They weren’t the only ones offering these services back then, but they’ve managed to dominate the market ever since with great credit,” explained Robert J. Thompson, a professor at Syracuse University and founder of the Belair Center for Television. Interview with Efe.
In 2002, the company went public with a valuation of one dollar per share, and five years later the introduction of the streaming format saw its wealth skyrocket.
In 2010, the company based in Los Gatos (California, USA) already had more than twelve million customers, mainly from the United States.
In addition, the massive purchases of smartphones around the world have allowed its vast catalog of online films and series to be consumed by millions of new customers.
“In numbers, Netflix has a library of original titles, and their intellectual property rights, as large as Paramount+ or Disney+,” said streaming expert and now college student Amanda Lotz. are teachers. In a statement to Efe, Queensland (Australia) K.
In 2018, Netflix became the platform with the most Emmy nominations, winning 23 awards, and a year later it received four Oscars for “Roma” and “Period.” end of sentence.
Then would come the covid-19 pandemic and the progressive containment, which caused a rebound in Netflix’s turnover by 2022, in part thanks to successful productions like “Squid Game” (2021) or the fifth installment from “La Casa of Pepper” Thank you. ‘ (2021).
Netflix struggles to remain the most popular platform
Since then, Netflix has seen a gradual loss of leadership as the world’s most popular platform, setting alarm bells ringing among its investors with its share price crashing last year.
And it is that since 2019, in addition to their traditional competitors HBO and Amazon Prime Video, other streaming services have appeared as powerful as Disney+ or Apple TV+.
In fact, the company predicted losses of up to two million subscribers in the second quarter of 2022, which ultimately amounted to 970,000 unsubscribed accounts.
Professor Thompson said: “There aren’t enough people on Earth for Netflix to reach the level it was decades ago, but that doesn’t mean it won’t cease to be relevant.”
So far this year, the company has laid off 300 employees and has oriented its medium-term strategy around two main axes: the penalization of accounts shared by several customers, only one of whom pays a subscription, and advertising. Possible introduction of materials through low-cost planning.
However, according to experts, if Netflix wants to stop the bleeding, it will now have to bet on the inclusion of advertising as well as the broadcasting of live content.
“Still, it will be difficult because they don’t have customer data as useful as other tech giants, who can bet on targeted ads,” said David Craig, a media industry researcher, currently at the University of South America. said Efe. California (USC).
Netflix has previously aired special live events, such as the “Netflix is a Festival of Jokes” comedian festival, but, according to industry experts, the future lies in sports.
“ESPN+ (Disney+) broadcasts football in the United States and DAZN in Europe. This is perhaps one of the ways the game attracts a lot of fans attracted by the added value of live content,” said Craig.
Similarly, the researcher pointed to the “possibility” that “acquisition by a large technology or telecommunications company” or “merger with other platforms” could solve Netflix’s problems.
However, Netflix maintains a privileged leading position in the global streaming market with 220 million subscribers; 20 million more than Amazon, 15 million more than the Disney empire (Disney+, Hulu, Star and ESPN+) and 180 million more than Apple TV+.