The National Inflation Association (NIA) has released a report stating that Netflix’s future is in jeopardy if it is unable to compete with premium TV channels when it comes to desirable content. Netflix’s content costs over the last few years have skyrocketed from 12 percent of revenues to 50 percent of revenues.
From the report:
“If Netflix is going to keep their monthly subscription fees near their current low levels without implementing the same price increases that cable TV companies have been forced to pass onto their customers, Netflix in the near-future will only be able to offer older movies and TV shows that are no longer in high demand . . . There will be no reason for Netflix to exist in the future.”
With its content costs streaking upwards, do you think Netflix will be forced to increase prices anytime soon? The company caused a small stir the last time it tried that, and it will be interesting how Netflix chooses to cope with the swiftly changing streaming landscape.
[via Home Media Magazine]