Netflix’s Kryptonite? Competition

Throw the damn towel! Everyone gasped as Netflix announced they missed their subscriber growth estimates by 2 million and the future doesn’t look more promising either. The stock has taken a tumble, going down as much as 10% after-hours.

Netflix was a major winner of the pandemic. Everyone was forced to stay at home, so Americans did what they do best. Sit on their couch and watch hours of Netflix. However, as Netflix struck gold, other media companies who’ve been preparing to take the streaming giant’s market share for quite some time, came to play. Media behemoths like Disney, NBCUniversal and HBO unveiled their platforms over the course of the pandemic. They have all experienced massive growth as viewers seek more options as the world still slowly opens up.

Netflix isn’t going away. They still have an incredible library of content on their platform and have more enticing options on the pipeline. The problem is, for the first time ever, they’re experiencing actual competition. These other services are owned by large media conglomerates who can choose to house their libraries and forgo Netflix. This puts a lot of pressure of Netflix as they are now under watch to pump out original content, while struggling to raise prices and own the eyeballs of viewers since they’ve lost their moat.

Netflix will continue to be a giant in the media industry. Nobody is getting rid of it since there’s so much to offer. However, the massive growth story is gone as the big kids have come to play.