[richmarr]

My understanding of this is different. Streaming services are at the mercy of the prices determined by those who own the content.

If they make lots of money, up go the licence fees.

The decision to create their own content seems like an inevitable consequence of that, and acts as a deflationary force on prices as licenced content has to compete for airtime with content commissioned by the streaming service.

[erikbe]

Producers are dependent on distributors, and distributors are dependent on producers.

Producers thought they'd improve their position by going into distribution. Distributors (Netflix) thought they'd better themselves by going into production.

Perhaps they would have been better off focusing on either producing or distributing. A distributor improves their bargaining position by growing the audience they can reach. Producer, by making better films that more people want to see.

[kiriakasis]

In this case producers have a strong upper hand. If a producer does not sell any license for a year it loses a lot of money, if netflix does not have any license for a year it loses all its audience.

[dageshi]

It won't work with Netflix's model. The flat rate pay x and watch as much as you want doesn't work for the producers, the prices they can negotiate for their content are always capped based on the fixed subscription at netflix. Given that it's much more appealing for them to launch their own service and get 100% of a smaller customer base which they can potentially grow in the future.

[erikbe]

For Netflix, it doesn't work to only show their original productions on their own platform. We will likely see them start to show their films in theaters to maximize revenue, and even offer one-time access for people to watch a film but not sign up for a subscription. What's more, they're probably going to have to turn their series into events by showing new episodes on schedule, once a week. By becoming producers, they are forced to completely abandon their old model, I believe.

[nordsieck]

> We will likely see them start to show their films in theaters to maximize revenue

Seems unlikely to me. They're doing it on a very limited basis right now, but that's not for revenue; it's to get the movies in the running for awards.

> offer one-time access for people to watch a film but not sign up for a subscription

Seems unlikely. The number of people who think Netflix is expensive enough to avoid, and don't have friends they can mooch off of or get a group buy with is pretty small.

> they're probably going to have to turn their series into events by showing new episodes on schedule, once a week.

I'm really curious about this one. I have no idea why they would possibly want to do this.

In network TV land, broadcasters have time slots for shows so they can more efficiently sell advertising slots. Even if Netflix decided to start advertising, they can just tie ads directly to videos being watched.

[javagram]

> I'm really curious about this one. I have no idea why they would possibly want to do this

Traditional tv shows can also get buzz by people chatting and theorizing about them week to week as the episodes trickle out. This isn’t really possible with the Netflix binge model.

They can also release faster since episodes trickle out as they are done. Not sure how often this happens vs editing and releasing later.

Whether this type of “buzz” actually is that important from an economic perspective or if it just generates a bunch of noise online and at the water cooler, I don’t know. So far Netflix seems content to drop content using the binge model.