Thread: VOD Netflix/Streaming Services
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Old 11-05-2019, 12:48   #5257
jfman
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Re: Netflix/Streaming Services
Quote:
Originally Posted by OLD BOY View Post
Except that Netflix is paying its bills. Most new companies start off with debts and some of the big ones will be in considerable debt for a great many years. It's what is called investment.

In time, the number of Netflix subscriptions will have increased considerably as its reach extends into new markets, increasing its income, and once their library has built up sufficiently, they will reduce the amount of content they are currently adding down to more sustainable levels.

If that turns out to be insufficient to balance the books and make a profit due to increasing competition, then a free or reduced price alternative with commercials would be a further means of increasing income. At the same time, they could decide to increase the price of the 'no ads' subscription service.
Most companies do not start off with debt levels at between 2 and 3 years of subscription revenue. Especially if they don't have tangible assets to secure the debt against.

Price rises are inevitable once they've consolidated market share, we are agreed on that.
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