Content and Its Discontents
by Bill Hayes
In Content and Its Discontents for the New Yorker, James Surowiecki looks at the business of Netflix.
[I]n its seventeen-year history Netflix has created two markets practically from scratch — online DVD rental, then video streaming. In the process, it has reinvented itself three times: it began as a traditional pay-per-rental company, turned itself into a subscription rental service, went into streaming, and then moved into original content. Yet, in the past couple of years, Netflix has actually become a rather familiar kind of business. Jeffrey Ulin, the former head of distribution at Lucasfilm and the author of “The Business of Media Distribution,” told me, “If you really look at Netflix, it’s a pay-TV company.” He went on, “People still think of Netflix as a video store, because that’s their history. But the way a pay-TV service works is that people subscribe and pay a monthly fee for a service that aggregates content and offers original content of its own. That’s exactly what Netflix does.” [more]