You know how movies studios keep making the same movie over and over and over again with just slight changes? It seems that the entertainment industry simply has a problem recognizing that doing the same thing repeatedly won't lead to different outcomes. In particular, the entertainment companies continue to think that because they own the content, that they somehow have leverage against the new generation of distributors -- missing out on the fact that it was always
the distribution side of things that gave them the leverage, rather than the content itself. That is, they're overvaluing the content
and undervaluing the services
that make that content useful. That's why the record labels were unable to realize that they handed Apple tremendous power
over digital music sales. It's why the record labels still don't seem to realize that they need YouTube
more than YouTube needs them.
Now it's the movie studios' turn.
points out that the movie studios are apparently pissed off at Netflix, saying that they're trying to renegotiate deals on tougher terms
. As Nolan points out, those studios may discover they have a lot less leverage than they think. If a studio pulls its movies from Netflix, those studios may find that it hurts them a lot more than it hurts Netflix, which has increasingly built a dominant position in the movie distribution space. Yet, of course, because these firms overvalue the content, they don't seem to be able to see this coming, despite all the foreshadowing...