Everyone wants a piece of the $19 billion U.S. subscription video market that Netflix created, then cornered.
The big picture: Netflix has already reached saturation in the U.S. with nearly 60 million domestic subscribers, and it can't afford to lose customers to new streaming rivals.
- NBC plans to launch a streaming service next year.
- AT&T (with WarnerMedia) and Disney (with 21st Century Fox) both plan to launch similar subscription video services this year.
- Hulu now has more subscribers (25 million) than Comcast, the biggest cable company in the U.S.
- And don't forget Amazon Prime, which has been the biggest Netflix competitor to date.
Between the lines: Many of the networks involved in rival services have begun pulling back on licensing their content to Netflix, promoting exclusivity to their own content instead.
- This is why AT&T said last year that it will only license "Friends" to Netflix for a year before it launches its own service.
It's also why Netflix is pouring billions into creating more of its own original content series for TV:
- The new hit "Tidying Up with Marie Kondo"
- Hyper-localized content series like "Sacred Games" in India
- Movies like the viral sensation "Bird Box"
Yes, but: Netflix may have an even bigger headache to deal with: free competition.
- Digital streaming TV companies that don't charge people for access are rising as consumers face saturated budgets for subscription content.
- Services with ad-supported channels or tiers, like Roku and Hulu, are booming.
- And pay-TV companies like AT&T, Dish and now Comcast (which owns NBCUniversal) are giving subscribers access to new streaming video services for free.
What's next: The company reports earnings for Q4 tomorrow. Analysts seem bullish that Netflix will announce record subscriber growth.
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