Netflix: A Case Study

To take a final look at how streaming technology has changed television we’re going to take an in depth look at the popular example of Netflix.

When was the last time you’ve watched a TV show live as it is being aired? If you’re between the ages of 18-35 chances are it’s been awhile. This is because we are no longer watching TV the way it was originally intended. We are using things like DVR, Hulu, Amazon Video, and most importantly, Netflix. Netflix is TV’s number one competitor these days because of how quickly and constantly the company is growing. People are now getting TV faster, cheaper, and on-demand- leaving their cable boxes and satellite TV subscriptions behind them.

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Netflix is an internet television service that provides streaming television and movie content. It started out in 1997 as a DVD by-mail service in direct competition with Blockbuster. By 2007 Netflix introduced streaming, which has been key to it’s success. It allowed it’s users to watch television shows and movies instantly from their personal computers. As of today, Netflix is officially available worldwide on any internet connected device.

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What makes Netflix different from traditional television is it’s use of streaming technology, which is why for the first time since it’s arrival in the 1920s, televisions are on the decline. (Tech Insider). Netflix is a unique example because they out-innovated their competition. Instead of using the same business models as it’s competitors, like Blockbuster or even traditional cable,  Netflix saw digital streaming as the way of the future. So they shifted their focus from movies-by-mail to “Watch Instantly,” letting their customers watch anything they wanted, whenever they wanted, wherever they wanted (as long as they had an internet connection). As I’ve said in previous blog posts, this is done through the use of a progressive stream which has a large enough server to allow for many simultaneous users. This is what allows Netflix to give it’s customers on-demand streamed services from any device– the platform for what has made the company so successful.

The traditional linear model of television no longer makes sense in our digital, streaming age of technology. Our world is seeing a shift from a traditional monologic (one-to-many) model of communication, where we are receiving information and media from the source of certain broadcast networks and companies, to a more dialogic (many-to-many) model, where anyone is now able to contribute and create content and broadcast it to the world through the Internet. This is putting the power in the hands of consumers and consumers no longer want cable services to dictate when and how they watch certain programs. They like being in control with the ability to watch whatever they want on their own terms and without constant commercial interruption.

This new trend of over-the-top streaming television has created a rise in cord-cutting, the process of canceling cable or satellite TV subscriptions for an alternative Internet-based or wireless service. In fact, Netflix caused 50% of the U.S. TV viewing drop in 2015 and it is said that Netflix is on track to attract a larger 24-hour audience than each of the major broadcast networks, ABC, CBS, FOX, and NBC, sometime this year.

Why has this been so successful, you ask? Well, several reasons. It is very affordable for consumers, you can subscribe for an unlimited monthly plan for less than $10, or there are certain pay-as-you-go plans, so customers only pay for what they want to watch. This is a huge enabling factor as to why so many people are opting out of traditional cable plans. Netflix is always innovating and thinking of the future, they took a big risk when they moved to online streaming, but they knew it was the way of the future and they have smart and creative employees that calculate and predict future consumer behavior. They also have partnered with several bigger networks and studios, such as Warner Brothers, Marvel, and ABC, which was a win-win for them. They are able to get revenue from those studios wanting to reach the Netflix audience and able to show content that already has a large fan base– adding to the number of users they already had. This helps the studios too (who were not happy about digitizing content) because they now have a long and viable future through companies like Netflix. This helps Netflix save money that they can put towards producing their own content, like House of Cards, Orange is the New Black, and many more.

This shift in the way we are getting our television has changed the way we consume television as well. New trends of “binge-watching” have been controversial since the rise in Netflix users.

According to a 2013 Netflix survey, binge-watching is defined as watching between 2-6 episodes of the same TV show in one sitting. It’s often been said that Netflix is what created the binge-watching trend. You have immediate access to all episodes in a series once the show is released and it automatically cues the next episode of whatever you’re watching up to three episodes, after which it will ask if you are still watching and with the click of a button you’re hooked for another 1-3 hours. This is something almost anyone these days can relate to and social media and the Internet have blown up this trend even more.

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A quick google search will show results glorifying binge-watching as just another mainstream trend.

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And while this has become popular culture’s newest pastime, it can be causing serious health problems.

Several studies have found binge-watching to be linked to depression and loneliness. A (study) from the University of Toledo found that binge-watching had a positive correlation with poor mental health and physical wellbeing. Results from one study at the 2015 International Communication Association Conference showed that the effects go hand-in- hand, and that people who are depressed, or more prone to loneliness, are more likely to binge-watch. A study at the University of Texas found that those who binge-watch excessively start to neglect their work and their relationships with others, and it becomes a form of addiction. Since you are spending your time watching TV, you’re not allocating the time needed to get important daily tasks done. It is important to note that none of these studies have said binge-watching causes poor mental and physical health, but that it has been strongly correlated with such things.

Binging on anything isn’t going to be good for your health, but there have been some positive outcomes from binge-watching Netflix too. Many viewers have stated that certain shows are “meant to be binged,” it enhances the experience. Being able to stay engaged with a certain program without commercial interruption or needing to wait a week after a cliffhanger has created a whole new kind of immersive viewing experience. Viewers are able to connect more with the characters and the story in a shorter time frame. A Netflix survey revealed that nearly eight in ten people said binge-watching a TV show made it more enjoyable than watching single episodes. That same study also found that nearly 75% of the respondents reported having positive feelings about binge-watching and it was a way to relax and escape the stress of their busy lives. There has also been talk that in our modern age of social media and technology we have shorter attention spans, but binge-watchers are able to focus on things for longer periods of time. (The Science of Binge Watching). It’s also been a positive change for TV creators as well. Since there is no need for writers and producers of shows to leave a cliffhanger before each commercial and at the end of each episode, they have much more creative freedom. (Tina Fey commented) that “the new streaming format is very ‘freeing.’ Expect fewer constraints; more experiments.”

As you can see, Netflix has had effects on the way we get television, the way we watch television, and even the way we create television. It is still not totally understood on whether or not those effects are good or bad, but I’m interested to see where this streaming technology takes us in the future.

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