Netflix: Threat or Opportunity?
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Netflix’s success in the US and in Western Europe has demonstrated that consumers are willing to change how they watch and pay for TV and movies. As a result Netflix’s OTT proposition is challenging traditional pay TV models and changing how new broadband services are looking at content. For some players Netflix is a threat and for others an opportunity. So, how should content owners, channels, pay platforms and broadband providers respond?
Description
Format: PDF file
Pages: 34 pages Charts: 27 Author: STL research team Publication Date: January 2015Table of Contents
- Executive Summary
- Introduction
- Overview of Netflix
- History
- Consumer Proposition and USPs
- Netflix International Expansion
- Netflix Financials
- Attitude of the Financial Markets
- Impact of Netflix on the Market
- Impact on Rights Owners and Producers
- Impact on Channels
- Impact on Pay Platforms
- Impact on Broadband Operators
- Summary impacts on players along the value chain
- Responses to Netflix
- Case Study: HBO
- Case Study: BSkyB
- Case Study: Broadband Operators
Table of Figures
- Figure 1: Selected Media Companies Market Capitalisation, 1st Sept. 2014 (left) & 1st Jan. 2015 (right), USD billion
- Figure 2: Netflix’s subscriber targets for 2020 (announced launches only) in USD million
- Figure 3: Summary of Netflix’s Impacts along the Value Chain
- Figure 4: Netflix subscribers 1999 – 2014 in 000s
- Figure 5: Reasons Netflix streamers subscribe to the Service
- Figure 6: Netflix’s Evolving Content Proposition
- Figure 7: Netflix’s user interface
- Figure 8: Netflix geography and timeline
- Figure 9: Netflix’s Market Penetration over time to Dec 2013 (% households)
- Figure 10: Netflix revenue per service area, 1999 – 2014, USD million
- Figure 11: Netflix’s revenues & costs per business line, 2011–2014, USD million
- Figure 12: Netflix’s net income and free cash flow, 2009 – 2014, USD million
- Figure 13: Netflix’s streaming content obligations, 2010 – 2013, USD million
- Figure 14: Selected Media Companies Market Capitalisation, 1st Sept. 2014 (left) & 1st Jan. 2015 (right), USD billion
- Table 1: Comparison of Key Value Ratios
- Figure 15: Netflix’s share price (USD), Jan 2010 – Jan 2015
- Figure 16: Players along the Value Chain
- Figure 17: Subscribers to premium channels in the US (%of TV households)
- Figure 18: Changes in US Pay TV Penetration
- Figure 19: Percentage of Households that are “cord-cutters”
- Figure 20: Real Time Entertainment Share of Downstream Traffic
- Figure 21: Share of Traffic of Downstream Peak Time Applications
- Figure 22: Summary of Impacts along the Value Chain
- Figure 23: Overview of Sky Expanded Offering
- Figure 24: Sky’s offering across All Windows
- Figure 25: Vodafone / Spotify and Sky Sport deals – Impact on mobile broadband usage
- Figure 26: Netflix Broadband Partners
- Figure 27: Netflix Competitor Set
Technologies and industry terms referenced include: BSkyB, cable, content, Disruption, entertainment, HBO, Netflix, OTT, pay-TV, Strategy, Telco, Telecoms, Time Warner, video, VOD