Like Johnny Appleseed transforming communities across the country by plopping down orchards along his path, technology swept through the media industry, changed everything about the landscape, and left.
Fifteen years ago, Netflix as we know it came online. The company started a decade prior, shuttling DVDs across the country from massive warehouses and making a lot of money (along with running a few famous competitors out of business) in the process – but that’s not really Netflix, that’s a distant ancestor to today’s core product. In 2007, when the first thousand-some-odd movies were magically made available in your browser with the click of a button, that’s Netflix.
It’s hard to remember now, but that click-and-just-watch moment was basically magic. Broadband adoption was steeply climbing across the United States in that decade, but still less than 24% of homes had high-speed connections. Blu-ray and HD DVD were still new and duking it out to see who would be king of the latest format war. Streaming existed as a concept, but it was mostly used as either a not-quite legal way to pirate a movie, or for shorter and lower-quality content on YouTube and other sites. The idea that real, Hollywood movies were available whenever you wanted, wherever you wanted, at just a click was revolutionary.
But like all revolutions, eventually you have to settle into the “after.” In the years since, pretty much every media company threw together their own streamer. And now, the difference is no longer the technology, it’s the content.
What was once the hard thing became the easy thing. It’s hard, but not hard hard to build a streamer. It’s a “solved” technical problem, a lot like building an e-commerce storefront or a blog was a ton of work a generation ago – and just a few clicks today. The infrastructure takes a team of pros, but it’s a lot more like building a car than a time machine, the basics are figured out already.
The result is brought into clear focus by Netflix’s recent decision to launch an ad-supported tier of service. After disrupting the multi-billion dollar entertainment status quo, ushering in an era of cord-cutters, and becoming synonymous with “chilling,” Netflix has turned into what it once replaced, a cable network.
<blockquote class="twitter-tweet"><p lang="en" dir="ltr">It fascinates me how completely peripheral tech is to TV and movies. It changed the market and left.</p>— Benedict Evans (@benedictevans) <a href="https://twitter.com/benedictevans/status/1576573171771314176?ref_src=twsrc%5Etfw">October 2, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
For years, journalists, investors, and other members of the tech universe would refer to “FAANG” companies as the upper echelon of industry giants that have disrupted the past and are building the future. These companies were:
Netflix certainly upended entertainment with technology, but they always felt like the odd man out in that group – they just aren’t the same scale as those guys. Here are the market caps as of this early week:
Apple is in a universe of its own, and while Facebook (now Meta) has stumbled badly in the past year, even in its weakened position it is more than twice the size of Netflix.
To be fair, Netflix has been innovating around the edges, dabbling with video games and interactive choose-your-own-adventure content, but today they are effectively as much of a technology company as Disney is. But even more to the company’s credit, they get that. Netflix’s leadership saw the writing on the wall early on, and has been pushing further and further into originals since "House of Cards" first turned critics heads.
Fighting a content turf war with century-old behemoths is a tough fight, but they might be up for it. After all, they did run Blockbuster out of business and then mercilessly placed its hollowed-out-skull on a stake in the form of a mediocre sitcom. Do they have another technology revolution up their sleeves to win this day?