Netflix: Will Content be Enough?
(8 pages of text)
Case (Pub Mat)
In 2019, Netflix had 167 million subscribers globally and offered thousands of television shows and movies on its streaming application, a growing proportion of which it produced itself. Media giants, who for years had valued the relationship with Netflix because it provided an additional outlet, began to re-evaluate their own (make) versus contract (buy) distribution decision. Leveraging acquisitions, technology investments, and vast content libraries, they entered the streaming wars by going direct to consumers. Was Netflix vulnerable in head-to-head competition in an increasingly fragmented market? How should it respond to entry by its former partners?
This case is designed for use in elective courses on management and economics at both the undergraduate and graduate levels. After working through the case and assignment questions, students will be able to do the following:
- Examine the evolution of home entertainment technology, viewer preferences, and the entry and exit of market participants to assess incumbent responses to disruptions.
- Use the Porter’s Five Forces framework to analyze the US video streaming industry.
- Evaluate the advantages that come with incumbency (first mover), economies of scale, brand reputation, and innovation.
- Evaluate the make versus buy tradeoff.
- Evaluate the opportunities and risks of alternative strategies to combat new entrants.
Information, Media & Telecommunications
United States, Large, 2019
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