Netflix’s big problem, it seems to me, is that it can’t afford the content that its subscribers most want to watch. It could try to by streaming rights to every major Hollywood blockbuster in history — but doing so would cost hundreds of billions of dollars, and could never be recouped with $7.99 monthly fees. What’s more, the studios can watch the Netflix share price as easily as anybody else, and when they see it ending 2013 at $360 a share, valuing the company at well over $20 billion, that’s their sign to start raising rates sharply during the next round of negotiations. Which in turn helps explain why Netflix is losing so many great movies. (source infra)
Another view of Netflix --
Netflix’s dumbed-down algorithms | Felix Salmon: "... Netflix, then, no longer wants to show me the things I want to watch, and it doesn’t even particularly want to show me the stuff I didn’t know I’d love. Instead, it just wants to feed me more and more and more of the same, drawing mainly from a library of second-tier movies and TV shows, and actually making it surprisingly hard to discover the highest-quality content. It’s a bit like what Pandora would be, if Pandora was severely constrained in the songs it could choose from..."
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