by Mike Masnick
Thu, Jan 20th 2011 8:22am
Back in December, we did a little back-of-the-envelope calculating to show how much more expensive it is for Netflix to license movies for streaming, as compared to just buying DVDs and shipping them out. The differences are staggering. And apparently it's only getting more expensive. The Hollywood Reporter has an in-depth article highlighting the love-hate affair that Hollywood has with Netflix, including details on the sorts of prices that the various players are demanding (and often getting) from Netflix. What's not surprising is that they keep asking for more and more (and some are still complaining that Netflix doesn't pay enough). But the numbers being thrown about are simply staggering. And at the rate they're going up, it will make it increasingly difficult for Netflix to actually afford all of those deals. Once again, it seems like a situation where the content providers are overvaluing their content, and undervaluing the services that make that content more valuable. That is, they look at how Netflix is succeeding (especially as they're failing to adapt themselves online), and they start to get jealous, and assume that Netflix really should be paying them more money. Basically, they don't think Netflix deserves to profit at all, since it's really all "their content." What they ignore, of course, is that (despite multiple weak attempts) they were the ones who failed to provide a compelling streaming service themselves. Either way, if Hollywood keeps pushing those numbers up, they may discover that they end up killing the golden goose.
If you liked this post, you may also be interested in...
- Matchstick, The More Open Chromecast, Destroyed By DRM, Announces Plans To Return All Funds
- Appeals Court Says Netflix Doesn't Violate Privacy By Displaying Viewing History To Anyone Using That Account
- Taylor Swift's Streaming Rant Nearly Identical To Garth Brooks' Used CD Rant
- Comcast Lobbyist Admits It Helped Create Netflix By Refusing To Compete On Price
- Netflix Now Supports Charter Merger After ISP Promises Not To Screw Up The Internet...For A Measly Three Years