Don’t Bet Against Netflix, at Least Not Now

Michael Giberson

Jonathan Knee argues that Netflix is succeeding the way big media companies always have succeeded, in a time where such opportunities are less frequent than before. From The Atlantic:

The economic structure of the media business is not fundamentally different from that of business in general. The most-prevalent sources of industrial strength are the mutually reinforcing competitive advantages of scale and customer captivity. Content creation simply does not lend itself to either, while aggregation is amenable to both.


Netflix’s success in streaming video is therefore hardly paradoxical. The company sits squarely in the tradition of the most-successful media businesses: aggregators with strong economies of scale and customer captivity.

There is a lot more explication at the link.