The Future of Streaming Video According to Netflix

Netflix CEO Reed Hastings wrote an 11-page essay that lays out his vision for the future of streaming video. All Things D’s Peter Kafka has summarized most of his assertions. There are a few big takeaways for me about where Netflix might be heading and where the future of the industry might be as well.

  • Apps replace channels, is a common sentiment among many. The problem is people aren’t cutting the cord and channels have no incentive to turn their business into an app. Maybe ESPN would if they could charge potential customers $5 per month for a subscription fee. Regardless, it’s not crazy to think those generating content could package their offering directly to consumers — think of MLB.tv, etc.
  • Netflix would be wise to partner with Aereo because people are more willing to cut the cable cord if they have access to live TV, which Aereo delivers via the Internet in certain markets, and live sports. It would help Netflix begin to develop an app platform and bridge the gap for those wanting to cut the cord but not yet willing to.
  • Apple is a good position to do something in the TV space. They already have the infrastructure in place, but they need tweak Apple TV’s OS to allow third-party apps and probably bump up the in-app subscription price about $1.99 per month so channels like ESPN or HBO can charge whatever they heck they want per month.
  • Netflix is walking a fine line between creating the future of video delivery on the Internet and upsetting the Internet Service Providers who also happen to be the cable companies Netflix is disrupting and the content providers. This is ultimately the problem with having mega-corporations like Comcast supply Internet access, cable TV, and own NBC. Nothing like a good conflict of interest.

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