[woodycheers]

What the story is driving at is that people end up spending a lot of time on YouTube, when they could have spent it on Netflix, as its CEO has desired. Spending 60 odd minutes of 80 odd minutes one frequents the web for watching video on YouTube is massive.

[bilbo0s]

The thing is that it's a bit more complicated than that. The business models are different. Even if we don't do the full analysis we can see that someone spending 60 minutes on youtube instead of netflix means that netflix is not paying for that 60 minutes of bandwidth. Netflix doesn't have ads paying for everything, they have to pay for everything other ways. So that business becomes about more than just blindly getting eyeballs. You want the right eyeballs, based on the content you pay to offer. That implies some fairly complex modeling.

Now of course we'd need more information than Netflix would likely provide us to do a full analysis, but my sense from what we can know is that this guy is likely close to correct about what his enemy is.

[coldtea]

>Even if we don't do the full analysis we can see that someone spending 60 minutes on youtube instead of netflix means that netflix is not paying for that 60 minutes of bandwidth.

The bandwidth would be insignificant to Netflix compared to churn. Not to mention, with edge caches at telcos and so it, it would be already paid.

[anongraddebt]

I agree. Netflix aims to be a sort of global tax on TV and Movie based entertainment. Their business model runs up against biological constraints (with regards to the desire for perpetual growth).