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Originally Posted by OLD BOY
If the plan is to run at a loss initially, to increase prices over time and to expand globally while spending less on content when a sufficient library is amassed, that sounds pretty sustainable to me.
Netflix is playing the long game. No doubt you would have told us that Murdoch’s satellite TV service was doomed back in the 1990s.
I agree that Netflix has accumulated a lot of debt, but Murdoch’s venture actually nearly went under back in the day.I dare say that once Netflix have made retained their original material for so long, they will look to monetise them further by passing on the rights to broadcast over to other streaming services and who knows, maybe to conventionally broadcast scheduled TV channels. Maybe Netflix will come to their rescue with new content for them!
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Increasing prices over time in, what by your own assertion will be, a crowded marketplace with many different low cost products is very risky. At some point you stop being a low cost add on. Especially if you can’t justify the price premium. All the while one of your major competitors, Amazon, is amassing sports rights and other content and maintaining a low price due to the profitability of Prime customers to it’s retail arm.