Netflix got into the Obama business. But bringing in Susan Rice and making a lucrative deal with Obama only alienated subscribers and potential subscribers. And it did little to compensate for Netflix’s central problem, that its expensive obsession with its mediocre original content at the expense of secondary movies and shows, was alienating subscribers who have plenty of other options.
Even as HBO wants to turn itself into another Netflix (as does everyone else), its business model may be hitting a wall. Netflix’s stock fell as it missed its subscriber growth by a wide mark (and doesn’t appear to be releasing its overall numbers), and missed its revenue mark by a narrower margin. Domestic growth is slowing and international growth can only take it so far.
Netflix is a brand. But the brand has emphasized its lefty politics at the expense of programming quality. The Obama deal was another example of that problem. Adding Susan Rice won’t get you more subscribers when your core content is lacking.
Netflix is relying on shock and awe spending on Peak TV to intimidate its traditional rivals, but instead that has spurred a round of mergers and acquisitions as companies like Disney and AT&T strive to create entities capable of competing with it on its own terms.
Peak TV is shotgunning shows, but the lack of quality control means that much of the programming is weak. And aimed at the same demographic. And that demo, young upscale urban adults, have only so many shows that they can watch. As Netflix hiked its price, it lowered its quality. And its library has become a mix of dubious original programming and even more dubious secondary market junk.
Netflix may be headed for a crash and Peak TV’s gold rush may go with it.