Netflix, Inc. (NASDAQ:NFLX) has proven that it’s capable of producing great television, though analysts disagree about how significantly that should affect its valuation, but the usual comparison pitting Netflix against HBO may not go far enough. The rise of Netflix could spell the downfall of ‘event television.’
“Online, people are far more loyal to their interests and obsessions than an externally imposed schedule. While they may end up seeing the same stuff as other viewers, it happens incrementally, through recommendation algorithms and personal endorsements relayed over Twitter feeds, Facebook posts, and e-mails,” writes Tim Wu for The New Republic.
Netflix still in early stages for streaming TV
As successful as Netflix, Inc. (NASDAQ:NFLX) has been, we’re still in the early days of streaming TV. Americans average about 5 hours of television per day, but only 45 minutes of streaming video per week, but as adoption rates grow you can expect that ratio to change rapidly. Event programming started as a matter of fact: if you weren’t on when your show was on then you missed it. If it a lot of people went out of their way to see the same show, it became a cultural event. The economics grew up around technological reality.
But there’s no reason for people to watch shows at the same time anymore. Wu points out that while “the YouTube Music Awards may have been a bust as a live show, but within two weeks, the production had racked up 3.5 million views.” People watched the awards show on their own time, when it was convenient, just as they would with any other internet media. On-demand media transforms the fixed TV schedule into a network decision, and one that many viewers have already rejected.
“What remains of live programming is reserved for sports programming, breaking news stories, talent contests, and the big awards shows,” writes Wu, but even those categories may be under threat before long. People can just as easily get their news online, and as YouTube has shown awards ceremonies don’t have to be watched all at once.
Netflix, Inc. (NASDAQ:NFLX) has been telling us that it’s the future of television. As it expands into Europe and makes more and more content deals, it’s hard not to take that claim seriously, and the future of TV may have a lot fewer ‘events’ than we’re used to.