For the past three years, the global media and entertainment industry has been defined by the streaming wars. Each media company created a streaming service to compete. The story goes that only the strongest survive. Losers will be merged or die.
The streaming wars didn’t end last year, but a metaphorical meteor approached the entertainment world in the form of slowing growth. netflix lost subscribers. The stock has fallen more than 60%. disney, comcast unit NBCUniversal, Paramount Global When warner bros discovery The company’s stock price also fell dramatically as it transformed its business around streaming.
Media companies still drive hit shows, advertising dollars, and, ultimately, attention. But imagine what will happen on Earth when faced with the apocalypse. Land combat becomes less important. they may stop. The threat of mass destruction becomes a common enemy.
That’s what Netflix’s latest quarterly earnings report suggests. Netflix added 7.7 million streaming subscribers in the fourth quarter, beating analyst estimates of nearly 5 million. Netflix shares rose more than 6% after hours.
In the past, good news for Netflix was bad news for existing competitors competing with Netflix. Those days are over. The industry is now united. Disney, Comcast, Paramount Global and Warner Bros. Discovery all rose slightly following Netflix’s report.
read more: Netflix founder Reed Hastings resigns as CEO
Media companies have found themselves, at least temporarily, battling a common enemy: streaming subscriber fatigue. Wall Street doesn’t like slowing growth.
Netflix’s big quarter doesn’t yet include the consequences of forcing password sharers to pay. This process will start shortly. This could be better news for Netflix and the industry as a whole, following Netflix’s lead. Netflix said it expects subscriber growth in the first quarter to be lower than in the fourth quarter for general seasonality reasons, but in the second quarter, Netflix is expected to roll out password sharing. I expect it to grow as more customers sign up rather than lose service due to the crackdown.
The world of old media was defined by Netflix disrupting traditional industries. Today, as Netflix is moving, so is the media world. Brother band. Sorting.
Watch: Netflix Stock Jumps After Subscriber Beat
