Netflix Vs YouTube & the future of entertainment

In a move directed towards competing with Netflix, Hulu, Apple (iTunes), Amazon and other video-on-demand services, Google recently announced movie rental services for YouTube users in United States. This mean the war is heating up in web video market. Entertainment-content-delivery-on-IP is THE future, no option to it. Cable TV, RIP!

Netflix which had a fabulous Q1 of 2011, reaching 23.6 subscribers in the US (outnumbering Comcast’s subscribers) & the always-improving, ever-growing Hulu are bound to be affected. It was because of this scare (from YouTube & other biggies) that Netflix shares went down 5% after it announced impressive Q1 results.

1. Reasons behind Netflix’s astonishing success (and how YouTube intends to compete)

  • It’s fee-based subscription model with diverse availability of content to choose from. YouTube movies on the other hand are on-demand/rentals, more like iTunes.
  • Its super awesome quality of the content. I have been using both Netflix & Hulu for more than a year now and I don’t remember of any glitch or streaming issue. YouTube’s famous bandwidth hogging is a dampener (although I should admit there has been some improvement on this front recently).

2. YouTube belongs to Google (Yes baby, smear campaign or not – people are scared of Google!)

Already a few Hollywood studios have refused to join YouTube and the too much policing on copyright issues have not gone down well with YouTube users. It is not going to be easy for YouTube either, but then no success comes easy. Advantage Netflix!

3. Omnipresence of YouTube

Arab revolutions used YouTube. Japan tragedy was all over YouTube. Iran pro-democracy protesters used it. European protests against austerity measures were on YouTube. Its 500 Million subscribers (of course, ‘free subscribers’) around the world give YouTube a huge penetration into emerging markets. In the long run, it is going to be extremely difficult to surpass for Netflix/Hulu etc. Do I see consolidation in the market?

Note – even HBO is online, everywhere. Never ignore the dark horse!

4. What else would YouTube wanna do?

  • Warner Bros, Sony, Universal have joined the YouTube team. Even a few educational institutes have. Education-future-is-in-online-videos may turn out to be a great idea.
  • Currently, there’s no famous artiste to perform in the YouTube team. It’s understandable since it’s just a move-rental service as of now. Going forward, it needs to learn from Vevo’s deals with artistes & athletes.

And finally, the future of TV (more-on-web):

With products like Boxee box (that kills cable), NewTeeVee (for Tech news), Apple TV (partnered with Netflix), we’re seeing a change in the way entertainment is driven off internet. Key partnerships (like Netflix with Sony Playstation) are going to prove vital.

Our living rooms are going to be owned by internet biggies – Google, Apple, Facebook & Amazon.

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14 thoughts on “Netflix Vs YouTube & the future of entertainment

  1. Ron Byers says:

    The TV industry is changing, no doubt. Changes are however good for the consumers – better quality, diverse options to choose from and of course, fierce competition.
    Don’t appreciate the negativity towards Google though, others are equally evil!!
    Overall a good post.


    • Thanks a much, Ron!

      I stated an observation (my opinion) about image of Google in Silicon valley, third-party developers, startups & common people. But I have my sympathies for they are attacked way more than others like FB & Apple. So much for being a market leader!

      Thanks again, for your comment.


      • Ron Byers says:

        I don’t think the same way.

        It’s not just for being a leader, biased (and financially influenced) tech press is equally responsible.

        Anyway, Netflix will be tough to beat –

        As you said, perhaps YouTube should start in a different segment or a different market (geographically or category-wise) to achieve breakthroughs.


      • Hurt a Fanboi, did I? Lol!

        You’re correct when you say we should get too carried away with the tech press. On the other hand, we can’t really expect media to not create/destroy/opinionate about the industry – after all media is about people. More on that some other time.

        Let’s wait & watch what YouTube does!!


  2. Rucha Sharma says:

    Good Post! I would like to know about the Indian point of it.
    Because in my observation the concept is still alien to us.


  3. hey I saw that there is another website that is stealing all of your posts! Do you want me to send you their website???


  4. I’m not sure why but this weblog is loading extremely slow for me. Is anyone else having this problem or is it a issue on my end? I’ll check back later on and see if the problem still exists.


  5. I like , bookmarked for future reference



  6. Carlos Slife says:

    I’d be inclined to give green light with you on this. Which is not something I typically do! I really like reading a post that will make people think. Also, thanks for allowing me to comment!


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