Netflix CEO Hesitant To Fight Cable 366
imamac writes "Those who were hopeful that Netflix would bring the fight to the cable companies may be disappointed in the latest comments from their CEO. 'Reed Hastings is pleased with his company's massive growth, but he fears that getting too large will start "an Armageddon" with cable networks.' It's a fight he doesn't think his company could survive."
Please fight the good fight Netflix... (Score:4, Informative)
Re:Vertical Integration (Score:4, Informative)
>>>market forces do not work towards efficiency in situations of "natural monopoly".
I agree with your viewpoint, but Comcast, Cox, et cetera are not "natural" monopolies. They are government-created monopolies. With modern technologies like fiber optics, there's no reason why every home cannot be wired with 50 incoming optical lines (1 cm thick bundle), each one carrying a TV lineup. Then the consumer could choose if they want Comcast or Cox or AppleTV or Verizon and so on.
Water, electricity, sewer are "natural" monopolies due to space limitations (i.e. big fat pipes or poles). CATV has no such limitation and there's no reason for a monopoly to exist.
Re:DO IT (Score:5, Informative)
All Netflix needs is the consumer on their side. They have that, already. Just not enough, yet. Right now, it's about 7% of the population with Netflix accounts. When they reach 20%, they'll have the critical consumer support to push those efforts. People will continue to flee cable, because even though there's more great television on now than ever before, it's not worth $1,200-$2,400/yr for it. Especially when the competition can do it for only $96/yr. For that much of a price difference, I think just about everyone can tolerate their content being a year behind.
In the mean time, Netflix is already working on generating their *own* content. They'll be able to sell that content to traditional television/cable networks for a nice up-front price and then after they've run it, he can return it to his own service and make long-term profit from it as content to generate new Netflix viewers. If he burns his bridges with cable before that, he has nowhere to shop that content they're currently spending $100,000,000+ producing.
Also, it's hard to argue with the man's history. In 2006, Mark Zuckerberg was listed in the CNN or Forbes (I forget which) list of "Top Tech Industry People That Don't Matter". Zuckerberg was on that list, because he came too late to the game when Myspace was already the big guy on the block. Then, they listed Reed Hastings a couple pages later, because the world was moving to streaming content and DVDs weren't going to remain relevant.
Five years later, those two "people that don't matter" are the biggest shit on the planet.
Re:Comcast isn't a monopoly everywhere (Score:4, Informative)
This apparently changed in 2007, but 4 years is not enough time to undo the damage of decades.