Netflix has added more subscribers in the past few months than any other streaming video services, far outpacing its competitors, and the growth has far exceeded all estimates that the company forecast. So that leads to the new question as to whether or not HBO is still the “gold standard” for premium TV content, which includes TV shows and made-for-TV movies.
In a new report from Yahoo! Finance, Netflix could be well on its way to taking the crown over from HBO in terms of great, mostly-uncensored content that has long been described as the “gold standard” of premium content. HBO has always had the market cornered for that classification, due mostly in part to broadcast and cable networks having the FCC breathing down their necks in regards to decency restrictions and potential fines.
— Geeks Of Color (@GeeksOfColor) January 13, 2017
But now that Netflix has come on the scene and started a revolution in the premium video streaming market, they have broken all the previously established rules set by premium cable networks like HBO, Cinemax, and Showtime. Netflix has essentially broken the mold and expanded the market to include internet streaming, thus ushering in millions of subscribers over the past several years. This includes Netflix taking the market to a global stage and making their content available in over 130 countries.
But the new gold standard for premium video content has been redefined to the point that Netflix has become the only destination for the consumer that logs in for just one thing – binge watching.
Now to be clear, HBO does indeed offer binge watching. But some of its content is spread out to coincide with seasonal episodes. The big difference here is that Netflix offers something that HBO does not, which is the ability to binge watch a new season of a TV show from day one.
— CBS News (@CBSNews) January 20, 2017
“Day One” binge watching for new TV shows could ultimately be what puts Netflix over on HBO, but it can also have its downsides. Netflix offers a free trial period for new subscribers to watch the library for free, and that presumably takes place in the countries for which it has a newly-developed presence. So that influx of subscribers that it might have accumulated during a specific point of time could have been people who bought into the promotion just to watch a certain show, then may tune out.
What Netflix is banking on is for these subscribers to browse their library and see everything else that Netflix has to offer them, thus giving them the brand power that could keep the subscriber.
HBO, on the other hand, already has that brand power and this could be what ultimately keeps them competitive in the streaming video market. But it still relies very heavily on its cable TV audience to bring in the revenue, which could hold it back in the streaming video market.
The concept here is that if HBO were to simply decide to adopt the Netflix strategy of “Day One” binge watching for its new shows, that would essentially kill its cable ratings and possibly the cable subscribers. That makes sense as well. Why would HBO subscribers wait week after week for their favorite show to air its episodes when they can just log on to their HBO GO app and watch them all back to back?
— Entertainment Weekly (@EW) July 30, 2016
So for HBO to adopt a Netflix strategy they would essentially be abandoning their original market (cable) and putting all of their weight into the streaming market, which could be risky, due to their relationship with cable companies and their long-time, dedicated subscribers.
[Featured Image by Netflix]