Netflix Faces Serious Competition

Will cutthroat competition from traditional media companies and Silicon Valley rivals spell Netflix’s downfall?

17:47 07 January 2019

Pioneering streaming service Netflix is now facing serious competition as content providers, Silicon Valley rivals and traditional media companies start their own service.

 

Top analysts agree that that biggest threat is Amazon. With a market value that is six times bigger than Netflix, Amazon has the deepest pockets and largest catalogue of content so far. 

 

Disney is also posing a serious threat to Netflix with its might of super franchises ranging from Marvel to Star Wars. The company is set to join the fray with its own streaming service, Disney+. It is also set to pull out its content from Netflix once its service is released.

 

Also prepping a service is AT&T-owned WarnerMedia, which content will include content from HBO, Turner and the Warner Bros film studio. Apple is also widely expected to launch a global streaming service this year.

 

Richard Broughton, an analyst at Ampere Analysis, said: “Netflix is facing increased competition from some of its previous content suppliers. Despite its major focus on original content the company is still hugely reliant on licensed content for subscribers and that carries risks.”

 

Broughton added that among the competition, Amazon poses the biggest threat to Netflix. He said: “If I had to put my money somewhere it would have to be on Amazon. New players like Disney and WarnerMedia will need a lot of time and marketing to break into households, and who else will want to licence content to them? Amazon has the deepest pockets. Its catalogue is by far the largest, even if a lot of the content is quite old, and it has been exploring sports rights and other areas other players aren’t. ”