Netflix, Inc. (NFLX) Should Continue To Do Well Without Live Streaming
Netflix, Inc. (NASDAQ:NFLX) has downplayed calls to expand into the live streaming business as one of the ways of diversifying and expanding its offerings. The calls come on growing concerns that the company growth has clocked saturation levels in the US. There is a feeling that the company is in dire need of a trigger, if it is to attract subscribers still on the sidelines.
Hulu revealed plans to take on traditional cable and broadcast networks with its own Live TV offering continues to evoke reasons why Netflix needs to join the bandwagon. The likes of Apple Inc. (NASDAQ:AAPL) and Amazon.com, Inc.(NASDAQ:AMZN) are also looking to come up with their own Live TV offering as the race for subscribers heats up.
Amidst the push, two questions remain unanswered. Does Netflix, Inc. (NASDAQ:NFLX) really need to venture into the live streaming business? Will such a move be a game changer?
Banking On Video on Demand
Netflix, Inc. (NASDAQ:NFLX) business model has kept cable companies on the defense in recent years, seen by the cord-cutting wave. Should it decide to enter the traditional TV business, it would put more pressure on a good number of cable companies already struggling. However, it might not be the right call, as its business model does not need TV networks for growth.
The streaming giant already boasts of a solid and sizeable base, which can continue to grow by relying on original shows. Live streaming won’t bring any game-changing element for Netflix in order to accelerate growth in US.
What Netflix Needs To Do
The likes of Amazon and Hulu are trying to play catchup in the streaming business thus expanding into live streaming won’t be a bad idea altogether. By doing so, they would be able to attract consumers who want to consume both live TV and video on demand.
Netflix, Inc. (NASDAQ:NFLX) has already attained the subscription base it desired at the start while betting big on its video on demand business model. Its biggest challenge going forward especially in the US is not the addition of new subscribers, but keeping current users excited to continue subscribing on a monthly basis.
To keep customers coming for more, the streaming giant will have to invest big on more exciting original shows like House of Cards. Even though Live TV programming would have offered more growth synergies, the same would not have had the same impact as original shows on the streaming giant.
Netflix, Inc. (NASDAQ:NFLX) is not closing the door entirely on live programming. Seen as an effort to have some exposure on this front, the company is launching its new Chelsea Handler talk show. The program will air three times a week.
Netflix hard stance against live TV programming could come to bite, as it stands to miss-out on people who like sports. Hulu expansion into this area of business is part of a bigger plan that seeks to address customers who cannot live without ESPN, known for live sporting events.
For Netflix, Inc. (NASDAQ:NFLX) to solidify its advantage in the business adding, live sporting events could have helped its shrug competition and attract some new subscribers. Adding such, a service could also have helped boost subscription revenues.
Netflix, Inc. (NASDAQ:NFLX) has been successful in its business model that pays more attention to original shows than anything else does. Safeguarding its assailable lead and edge in the business should be its primary goal even as other entities expand into live streaming.
What Netflix, Inc. (NASDAQ:NFLX) needs to trigger growth in developed markets is a game changing element. Given that live streaming does not have that factor needed to attract new subscribers in masses the streaming giant should continue doing well while relying on its video on demand model.
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