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Netflix Quietly a Huge Winner in Biden's Order Targeting Big Business (hollywoodreporter.com) 71

Posted by msmash from the closer-look dept.
Netflix should welcome -- even celebrate -- the White House's efforts to promote competition. Why? Look closely. From a report: As just about everyone knows, the suits in Washington D.C. have it out for Big Tech these days. Listen to the cocktail conversations about antitrust reform. Or watch the marches into courtrooms where the main objective is to break 'em up. And now read the executive order being signed on Friday by President Joe Biden, determined to undercut these behemoths and shift power from corporate gatekeepers to American workers. Then again, one $235 billion company stands to benefit from Biden's move -- a tech giant that's convinced everyone it's not really a tech giant, the member of FAANG never invited to those grill sessions on Capitol Hill where lawmakers use tech executives as hamburger patties. Just how did Netflix get so lucky?

Netflix is far and away the leader in streaming these days. It's also the star that everyone in the entertainment business with a telescope has been watching with envy. The last few years have brought one nascent streaming service after another. Except to succeed, Hollywood studios have convinced themselves they need scale. And so, we see both vertical integration as well as horizontal consolidation. Now, through his executive order, Biden is directing federal agencies to get tougher on proposed mergers. Very solid and wise reasons exist for more vigorously blocking and even unwinding mergers. Nevertheless, one has to ask: What might be a side effect of putting up more formidable hurdles to large-scale transactions in the entertainment space? Arguably (and yes, these arguments are almost certain to be raised in future legal challenges to blocked mergers), Netflix's position as top dog becomes more entrenched. If the FTC takes Biden's tip and pulls back on Trump-era guidelines for vertical mergers, that could hurt Amazon's prospect for acquiring MGM and transforming its Prime service into Netflix's toughest competitor. (Not that FTC chair Lina Khan needs any more reasons to stick it to Amazon.) And if the DOJ begins scrutinizing proposed mergers for how they impact labor markets, that could hold ramifications for WarnerMedia-Discovery or any other future tie-up that could threaten Netflix's ability to win the streaming wars.
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Netflix Quietly a Huge Winner in Biden's Order Targeting Big Business More

Netflix Quietly a Huge Winner in Biden's Order Targeting Big Business

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  • Headlines need to quietly get better (Score:3)

    by chispito ( 1870390 ) on Monday July 12, 2021 @10:10AM (#61575229)
    Think for a moment: what is the alternative here? Netflix loudly celebrates winning in Biden's executive order?

  • Netflix is light on mergers (Score:5, Interesting)

    by jacks smirking reven ( 909048 ) on Monday July 12, 2021 @10:19AM (#61575255)

    Reading this summary made me think about it and I could not recall Netflix making any major aquisitons in the last few years and checking it seems that is the case. I could find just 3 in the last few years:


    Millarworld – For an undisclosed price (rumored between $30-100 million), Netflix bought the comic book company owned by creator Mark Millar. Millar is the creator behind films such as Kick Ass and Wanted. This week, his first project for Netflix will come to the streamer—Jupiter’s Legacy—though his (arguably) most anticipated title—The Magic Order—has been in limbo.
    Storybots via Jibjab. Netflix wants to aggressively compete for kids programming, especially animated content. In 2019, Netflix purchased the Storybots brand from Jibjab, a maker of kids animated programming.
    Production facilities in New Mexico. Netflix also spent $30 million to buy production facilities in New Mexico in 2018. Recently, they announced plans to spend $1 billion on expanding their facilities.

    Netflix made a gamble years ago to focus on in-house made content and it seems like they have found success in that paired with certain licensing agreements and not simply gobbling up existing properties to leverage.

    What I would like to see however from this in terms of media and streaming is enforced licensing, as in if a service wants to license content from an existing studio or service they should be able to at a fair price and maybe with certain conditions, similar to a patent where the ownership studio get exclusive rights for a couple years but after that if another company is willing to pay the cost the owner cannot deny and hoard that content forever. Example is if Netflix wants "Friends" again and is willing to pay the price for it Warner/HBO simply cannot keep it to themselves for all time. I think that would lessen the importance of having to acquire content through M&A's and allow smaller competitors to assemble competing services.

    • Re: (Score:2)

      by crow ( 16139 )

      What I would like to see however from this in terms of media and streaming is enforced licensing, as in if a service wants to license content from an existing studio or service they should be able to at a fair price and maybe with certain conditions, similar to a patent where the ownership studio get exclusive rights for a couple years but after that if another company is willing to pay the cost the owner cannot deny and hoard that content forever. Example is if Netflix wants "Friends" again and is willing

    • Netflix also has massive competitors, in the form of every large media company has created their own streaming service.

      I think Disney can handle competing with Netflix without anti-trust help.

  • Easy (Score:5, Insightful)

    by bhcompy ( 1877290 ) on Monday July 12, 2021 @10:24AM (#61575263)

    Just how did Netflix get so lucky?

    Easy. They're not building their business through M&A. They're building their business playing by the rules of the companies that are trying to compete against them using M&A. They're licensing content and creating their own. They haven't made any major acquisitions other than buying a theater or two to try and qualify for the Oscars. Love em or hate em, they're the posterchild of a tech business working "correctly" in the current environment, where there's dozens of major streaming services and each rightsholder is trying to create their own

  • Sure maybe they are not a candidate for break up but they It's not like they just won the lottery either. Besides, they built their company from the ground up as opposed to just buying everything in sight. They could have bought MGM too but they didn't.

  • Netflix is gradually dying (Score:4, Interesting)

    by rsilvergun ( 571051 ) on Monday July 12, 2021 @10:56AM (#61575365)
    they haven't had a hit despite billions spent on content and they're bleeding cash like crazy. They need something on the level of Sopranos, Walking Dead or Game of Throwns or their investors will eventually eat them alive.

    Netflix is in the same place AOL was. Unless they get really lucky they're gonna be a hasbeen in 5-10 years as Disney continues to devour the world.

    I suppose if Biden makes it harder for Disney to buy stuff it might help, but Disney already owns so much I don't think it matters.

    • Re: (Score:3)

      by Junta ( 36770 )

      I agree with this sentiment, Netflix is at this point mostly coasting on momentum, and with their legacy catalog drying up by the day and only originals to lean on, they have a lot of challenges compared to all the companies going straight to the consumers instead of through netflix.

      I don't think 'oh no, this *might* keep Netflix relevant longer than it should' is a reason to shy away from regulatory action here. We have cloud-connected devices being shut down due to M&A routinely, multi-platform softw

    • Right in the summary, it mentions Netflix is dodging anti-trust WHILE talking about them trying to win the Streaming "Wars". Heavy tough COMPETITION is often characterized as a "war." What was the point of anti-trust regulation again?

      Netflix was big because it was 1st (in a new market space it pioneered) now it is under siege on all fronts with the existing industry oligarchy trying to become monopolies and lock out any new upstarts (like Netflix) by noncompetitive practices like buying up ISPs then breaki

      • Netflix was big because they had a popular service mailing DVDs to people.

        Now they're bleeding lots of cash and don't have anything most people want. They're popular primarily with licensed content that can easily go somewhere else.

        The service that made them big is already gone, they folded it up because of competition by Redbox. They're big enough to get enough investment to attempt a second thing, but so far they're not making money at it.

        They're not "dodging" anti-trust enforcement; they're simply not a

    • they haven't had a hit despite billions spent on content and they're bleeding cash like crazy. They need something on the level of Sopranos, Walking Dead or Game of Throwns or their investors will eventually eat them alive. Netflix is in the same place AOL was. Unless they get really lucky they're gonna be a hasbeen in 5-10 years as Disney continues to devour the world. I suppose if Biden makes it harder for Disney to buy stuff it might help, but Disney already owns so much I don't think it matters.

      Disney is like the top DVD selling website in the age of streaming. You and I are thinking like the old people we are. The kids? They don't care much. YouTube has ruined the youth. Why wait through a 90 minute movie for some good scenes when someone only 10 years older than you can make a video that shows NOTHING BUT what you're interested in? It's like comparing a 70s porn with an attempt at a plot (think Debbie does Dallas, Devil in Mrs Jones or Deep Throat) to the streaming porn you find today, whi

      • Most movies only have 10 or 20 minutes of content worth watching. Have you ever gone back and watched the movies we had as kids? Not the classics like your Star wars in your Indiana Jones and what not. But the b-tier stuff. Like all those action movies or the early Godzilla movies. They were fine when you were a kid because you had your toys with you and you would play with your toys and every time you heard something cool you look up and watch the cool stuff. Try sitting through that direct is an adult. I

    • We're in the middle of every large media company attempting to create their own subscription-based streaming service. So Netflix can't buy other major media company's products to stream.

      We'll have to see how this sorts out. I don't expect Disney+ to give up, simply because their catalog is massive at this point that they're probably able to charge more than anyone. But people like Paramount and Peacock may decide licensing to Netflix is better than hosting their own streaming service.

      Or not.

    • Their stock is still pretty close to their all-time high. Seems they are still doing something right.

    • Re: (Score:2)

      by teg ( 97890 )

      they haven't had a hit despite billions spent on content and they're bleeding cash like crazy. They need something on the level of Sopranos, Walking Dead or Game of Throwns or their investors will eventually eat them alive.

      Netflix doesn't bleed cash, it's profitable [fool.com]. The company earned $2.7 billion [statista.com] last year.

      Also, other than being the biggest - by virtue of pioneering the category - in a highly competitive market, I don't see them engaging in a lot of behavior that would cause concern. As a customer, I might even want less competition because the content is getting spread out across so many actors.

  • Maybe require live sports broadcast to be offered to cable / satellite providers

    amazon prime video may have the NFL games but they must offer the live sports feeds to cable / satellite (and can't tie the moves / shows in to that)
    Disney ESPN+ stuff can fall under the PPV access / Premium channel rules.

  • ...between members of the former Obama-Biden administration, including the Obamas themselves [variety.com], and Netflix.

    yup.

    I'm sure the one thing has nothing to do with the other...

    Of course, it's unlikely the Obama's and Bidens would ever chat about such things given how far away the Obamas live from the Bidens... that Obama retirement estate is, after all, a whopping two miles away [cnbc.com] from the White House...

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