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Lord_Hambrose posted:Y'all dummies must hate all entertainment because it is funded almost entirely by ads. Just television (cable and otherwise) and all search engines and free websites shutting down would result in massive societal change. Netflix is even worse. It's structurally a Ponzi scheme. User fees don't even come close to covering costs so they keep taking out junk bonds. The entire internet ad industry is a massive bubble too. The entire landscape of the internet will change when it finally collapses
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Jul 14, 2019 21:49
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One would almost think that an entire socioeconomic system based around making numbers go up has some massive flaws.
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Jul 14, 2019 22:16
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oxsnard posted:Netflix is even worse. It's structurally a Ponzi scheme. User fees don't even come close to covering costs so they keep taking out junk bonds. Just because they are financing through debt doesn't mean they are a Ponzi scheme. There's a whole other discussion to be had about whether financing through debt is good or bad or well regulated but Ponzi schemes typically involve not really offering a good or service at all and just paying off early-stage investors with later-stage investors money.
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Jul 14, 2019 22:24
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pseudanonymous posted:Just because they are financing through debt doesn't mean they are a Ponzi scheme. There's a whole other discussion to be had about whether financing through debt is good or bad or well regulated but Ponzi schemes typically involve not really offering a good or service at all and just paying off early-stage investors with later-stage investors money. Nah, their depreciation schedule for shows is hilariously sketchy in order to goose profits. Like that Will Smith Orc Cop movie is depreciated over 5 years, while Disney will take a 70% or more depreciation of an Avengers movie in one year. It's absolutely Ponzi finance as Directors and Executives cash out stock options while the company racks up debts they can't pay off
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Jul 14, 2019 22:29
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oxsnard posted:Nah, their depreciation schedule for shows is hilariously sketchy in order to goose profits. Like that Will Smith Orc Cop movie is depreciated over 5 years, while Disney will take a 70% or more depreciation of an Avengers movie in one year. It's absolutely Ponzi finance as Directors and Executives cash out stock options while the company racks up debts they can't pay off Why wouldn't it be that way? I can't walk into a theater and demand they play last year's avengers movie but I can watch a netflix movie as long as it's there and don't buy tickets per movie, a movie will get whatever value it gets in a wide halo compared to a theater movie. I am not netflix's accountant so I don't know if 5 years is the exact number and I consider bright to be an artistically terrible movie. But it seems pretty obvious that they wouldn't value the value of movies as being their opening night or something. They make money from a generalized subscription over time instead of cash infusions from specific viewings of specific movies. If a netflix property is good or bad it'll have a "netflix is a good/bad service" effect for a lot longer than the instant it's the newest thing.
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Jul 15, 2019 00:19
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Owlofcreamcheese posted:Why wouldn't it be that way? I can't walk into a theater and demand they play last year's avengers movie but I can watch a netflix movie as long as it's there and don't buy tickets per movie, a movie will get whatever value it gets in a wide halo compared to a theater movie. I am not netflix's accountant so I don't know if 5 years is the exact number and I consider bright to be an artistically terrible movie. But it seems pretty obvious that they wouldn't value the value of movies as being their opening night or something. They make money from a generalized subscription over time instead of cash infusions from specific viewings of specific movies. If a netflix property is good or bad it'll have a "netflix is a good/bad service" effect for a lot longer than the instant it's the newest thing. This of course is all just speculation since Netflix doesn't release any actual numbers on how many people are watching the orc cop movie, or anything else, but if they're basically starting from a much lower initial valuation like you're suggesting, and on a Will Smith movie of all things, then things are pretty dire. Cause you can stream The Avengers right now on a number of streaming services, including Netflix, and all of those movies are probably going to be watched and streamed by a lot more people than any of Netflix's original content
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Jul 15, 2019 00:35
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I would argue that isn’t true. Didn’t the newest Adam Sandler movie become the most streamed thing ever?
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Jul 15, 2019 00:42
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QuarkJets posted:This of course is all just speculation since Netflix doesn't release any actual numbers on how many people are watching the orc cop movie, or anything else, but if they're basically starting from a much lower initial valuation like you're suggesting, and on a Will Smith movie of all things, then things are pretty dire. The point is that netflix doesn't sell tickets to individual movies. They don't get anything specifically from you watching or not watching a specific movie. Their business model is that releasing movies people watch in a generalized way will pull in subscriptions. Which makes sense to count on anything added to the catalog to have whatever effect it's going to have over a long period of time, instead of being a thing that immediately makes money in it's opening night. Very few people sign up for netflix for a single specific movie. People just sign up generally when they have a general impression there is stuff on there consistently that they like. bright specifically is a bad movie, and I think a reputation based business model also suffers that converse, if they release strings of only movies like bright then it gets easier and easier to think of canceling long after the opening night of bright is far in the past. But how many people actually watch or don't watch a movie really doesn't factor in to how much money they make in a direct way the way every ticket to avengers sends like 8 dollars directly to the studio and if twice as many people watch something they make nearly exactly twice as much money. Netflix movies make money for netflix in a generalized long term way that don't even necessarily involve you watching them at all.
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Jul 15, 2019 01:38
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Empress Brosephine posted:I would argue that isn’t true. Didn’t the newest Adam Sandler movie become the most streamed thing ever? Netflix said it was the most popular movie on Netflix at the time, but how many idiots rewatched those avengers movies in anticipation of endgame this year? And how does the sum of viewers across all streaming services compare to the viewers of Netflix original movies? Nobody knows, because none of that data is public.
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Jul 15, 2019 02:14
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So apparently even on video streaming sites the pivot to video was bullshit
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Jul 15, 2019 02:43
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ryonguy posted:So apparently even on video streaming sites the pivot to video was bullshit It was a great idea when nobody was doing it, but like anything, it tanks when you flood the market. Small creators still do okay since they can subsist off fewer than a thousand dedicated fans but that doesn't scale well for larger entities.
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Jul 15, 2019 03:04
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I can't wait until there's too many streaming services and they have to start bundling themselves to be competitive and then we'll be dealing with cable 2.0
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Jul 15, 2019 03:06
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HootTheOwl posted:I can't wait until there's too many streaming services and they have to start bundling themselves to be competitive and then we'll be dealing with cable 2.0 Jokes on them, now there is less to watch on Netflix I just watch people not collect Mario coins and other noncommercial time filling media
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Jul 15, 2019 03:19
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Owlofcreamcheese posted:The point is that netflix doesn't sell tickets to individual movies. They don't get anything specifically from you watching or not watching a specific movie. Their business model is that releasing movies people watch in a generalized way will pull in subscriptions. Which makes sense to count on anything added to the catalog to have whatever effect it's going to have over a long period of time, instead of being a thing that immediately makes money in it's opening night. Very few people sign up for netflix for a single specific movie. People just sign up generally when they have a general impression there is stuff on there consistently that they like. You're going back and forth kind of quibbling over how accountants value intellectual property. I'm not an expert, but I do have a masters in accounting and did a certification in valuation which focused a lot on intellectual property and let me tell you, how ever Disney is accounting for intellectual property versus how Netflix is doing, neither of them are really reflecting much of reality. Whether Netflix will survive the streaming wars is hard to say. They are taking on a lot of debt in order to generate content. Netflix, unlike Disney faces substantial business risk because most of their cash flow is from their streaming service. Their DVD service is basically a rounding error at this point. If Disney loses too much money on their streaming service, they'll just sell it off, repackage it, or start licensing out material to Netflix again. Netflix doesn't have that option, if their subscription numbers fall too much they face bankruptcy if they can't service their debt (none of this, btw, makes it a Ponzi scheme).
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Jul 15, 2019 03:20
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HootTheOwl posted:I can't wait until there's too many streaming services and they have to start bundling themselves to be competitive and then we'll be dealing with cable 2.0 Maybe, but so long as piracy remains piss-easy there'll be a strong incentive to limit costs. No way you find enough people willing to pay ~$100 per month for an all-in-one streaming service when an ad blocker and thirty seconds of internet searching can get them whatever media they desire.
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Jul 15, 2019 03:25
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pseudanonymous posted:You're going back and forth kind of quibbling over how accountants value intellectual property. I'm not an expert, but I do have a masters in accounting and did a certification in valuation which focused a lot on intellectual property and let me tell you, how ever Disney is accounting for intellectual property versus how Netflix is doing, neither of them are really reflecting much of reality. I guess I mean that netflix doesn't sell tickets and probably doesn't get a super large number of subscriptions or cancelations per any one specific movie so of course they are going to value their catalog differently than a service that charges per movie. Bright got a huge number of viewers, I watched it, if this was a movie in the theater they'd be rolling in money because of that. But on a streaming service it isn't going to directly extract any money from me, and by being really bad is at best going to slowly sour me on netflix originals. It makes sense netflix doesn't focus specifically on viewership numbers in the first few weeks and thinks of movies as things that will have their effect spread out over several years. The economic effect for them of any specific movie probably is going to play out over years, not be something that has some instant effect. Everyone with a netflix account can watch a movie and that doesn't get netflix any more money (and probably costs them some minor amount in bandwidth costs) if the same people watch a movie in a theater that movie makes money off every view at that moment.
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Jul 15, 2019 03:41
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HootTheOwl posted:I can't wait until there's too many streaming services and they have to start bundling themselves to be competitive and then we'll be dealing with cable 2.0 That is literally what media companies want, everybody paying through the nose for premium channels they watch maybe 5% of the content on like it's 1996 again. The whole point of destroying net neutrality is to turn the internet back into this.
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Jul 15, 2019 04:33
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pseudanonymous posted:Netflix doesn't have that option, if their subscription numbers fall too much they face bankruptcy if they can't service their debt (none of this, btw, makes it a Ponzi scheme). My apologies for the Netflix derail, but this is incorrect. Netflix doesn't go tits up if they maintain current subscriber growth AND increase fees by 2x AND maintain content spending at current levels. It's absolutely a Ponzi scheme because it requires either an impossible profitability trajectory or investor funding to continue to increase exponentially. It's fundamentally a financing scheme with the veneer of a real business. The collapse of this company is going to be spectacular edit: increasingly negative cash flow has been required to maintain top line growth numbers and the only way they've gotten away with it is a fraudulent method for calculating profits oxsnard fucked around with this message at 05:20 on Jul 15, 2019 |
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Jul 15, 2019 05:17
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oxsnard posted:My apologies for the Netflix derail, but this is incorrect. Netflix doesn't go tits up if they maintain current subscriber growth AND increase fees by 2x AND maintain content spending at current levels. It's absolutely a Ponzi scheme because it requires either an impossible profitability trajectory or investor funding to continue to increase exponentially. It's fundamentally a financing scheme with the veneer of a real business. The collapse of this company is going to be spectacular Netflix is expecting to start cutting content spending as early as 2020. They’ve been spending like mad to replace licensed content, and their statements to investors they’ve clarified that the current amount of spending is nearing its peak and will start to fall. Like, licensed content costs nothing to produce but a lot to host and stream (especially since the other studios are trying to gouge them), and original content costs a lot to produce but virtually nothing to host (since they own the rights). Right now Netflix is in the worst of both worlds because they’re having to spend a lot of money on both. But they’re getting close to being able to license less and less content, which will reduce costs a lot. It isn’t guaranteed to work (how many GenXers will cancel their subscriptions when they can no longer watch Friends and The Office?), but it’s hardly a ponzu scheme. Saying that is like saying Amazon was a ponzu scheme in the 00s because they were spending so much laying out the AWS infrastructure.
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Jul 15, 2019 05:37
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LanceHunter posted:Saying that is like saying Amazon was a ponzu scheme in the 00s because they were spending so much laying out the AWS infrastructure. No. Content is, for the most part, a fungible commodity. The IRR for content creation has historically been closer in business model to something like a refinery. Disney has been the only company to demonstrate the ability to reliably monetize IP for decades after and even then it's still not great. Amazon was spending to get clients, where first mover advantage is HUGE (eg the stickiness due to migration costs). Netflix has tons of churn, their customers aren't mega corps. The two situations couldn't be any less similar
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Jul 15, 2019 05:47
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A ponzi scheme is the term you're looking for. A ponzu scheme is a criminal enterprise involving counterfeit bottles of citrus-flavored fish sauce.
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Jul 15, 2019 05:58
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Netflix is a Ponzi scheme because they deliberately and knowingly undercharge consumers and overpay for content in order to goose top line growth so they can issue exponentially more debt and stock options, which the board and Executives are, in fact, cashing out as fast as they can (not literally as fast, but as fast as they can to maintain the illusion of future profitability). I don't expect anyone to prove a negative, that it's not a Ponzi, but it basically is one in my view and the post mortem will be fascinating oxsnard fucked around with this message at 06:00 on Jul 15, 2019 |
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Jul 15, 2019 05:58
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Ratoslov posted:A ponzi scheme is the term you're looking for. A ponzu scheme is a criminal enterprise involving counterfeit bottles of citrus-flavored fish sauce. Pretty sure he's getting phone-post autocorrected.
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Jul 15, 2019 06:04
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Netflix is not a ponzi scheme. They're going with the only investment stategy that can keep the business model alive as IP-holders keep pulling their content to create their own platforms. If they can't swing independent content then the business is falling over anyway, and the investors are well aware that this is not only a gamble but the only gamble. Scheme implies some kind of deception, but there's no deception going on here.
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Jul 15, 2019 06:32
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yeah a Ponzi scheme implies that they're paying off old investors by borrowing from new investors, but that's not really what's happening; they have enough subscription revenue to make payments on existing debts and are using a lot of additional financing to try and build up a major film studio and publishing company
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Jul 15, 2019 06:38
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QuarkJets posted:yeah a Ponzi scheme implies that they're paying off old investors by borrowing from new investors, but that's not really what's happening; they have enough subscription revenue to make payments on existing debts and are using a lot of additional financing to try and build up a major film studio and publishing company At this point, I'm assuming he's just a troll. I've explained what a Ponzi scheme is, other's have. Netflix may well have a lovely unsustainable business model, I don't want to break out their 10-k and figure it out myself but I tend to doubt someone who just keeps insisting it's a Ponzi scheme, even when people politely explain why it isn't over and over.
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Jul 15, 2019 09:01
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pseudanonymous posted:At this point, I'm assuming he's just a troll. I've explained what a Ponzi scheme is, other's have. Netflix may well have a lovely unsustainable business model, I don't want to break out their 10-k and figure it out myself but I tend to doubt someone who just keeps insisting it's a Ponzi scheme, even when people politely explain why it isn't over and over. I will say that Netflix has made me get back into buying a few “classic” shows when they go on sale on iTunes or dvd, and slowly rip them to a Plex server. I want HIMYM always, and same with Parks and Rec, and I’m eyeing the Batman animated series.
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Jul 15, 2019 09:41
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Sundae posted:Pretty sure he's getting phone-post autocorrected. Autocorrect's most important function is to enable silly jokes.
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Jul 15, 2019 10:00
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Why should anyone care if Netflix is ripping off the investment class?
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Jul 15, 2019 10:08
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Beachcomber posted:Why should anyone care if Netflix is ripping off the investment class? Yeah, it's not a bank, they wont get a bailout, only the investors will lose out on it.
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Jul 15, 2019 14:25
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Beachcomber posted:Why should anyone care if Netflix is ripping off the investment class? Because not liking netflix is the new "I don't even own a tv"
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Jul 15, 2019 14:26
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I don't care for Netflix because I don't enjoy watching films; that's simply not a form of entertainment that I enjoy. While I automatically assume that any company of any consequence is involved in some shady and unethical practices by their simple nature, from a consumer perspective Netflix sounds like a lot of content for a very reasonable price for people who like that sort of thing. I'm certainly not going to thumb my nose at those who enjoy it. As a somewhat comparable example, I just had a birthday and as a small gift to myself I signed up for Origin's Basic membership. I don't know if I will keep it past the first month, but I will say that for the 4.99USD that I am paying there does seem to be quite a large selection of games available even though I'm only really interested in a handful or two, and I already own a few outright. So even though I'm not a film buff, I can certainly see the allure of paying a modest monthly fee to be able to choose from a massive amount of content even if the average person will only partake of a small sample of it ever. This assumes also that one has a high-grade internet connection at all times, which is something that I think many take for granted. I often find myself in situations where I would like to have things offline, and I've made a habit of preparing for that in advance.
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Jul 15, 2019 16:12
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JustJeff88 posted:I don't care for Netflix because I don't enjoy watching films; that's simply not a form of entertainment that I enjoy. While I automatically assume that any company of any consequence is involved in some shady and unethical practices by their simple nature, from a consumer perspective Netflix sounds like a lot of content for a very reasonable price for people who like that sort of thing. I'm certainly not going to thumb my nose at those who enjoy it. Most streaming services, definitely Prime and Netflix because I know I’ve done this, allow you to download content to play later offline.
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Jul 15, 2019 16:46
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PT6A posted:Most streaming services, definitely Prime and Netflix because I know I’ve done this, allow you to download content to play later offline. How do they keep people from "stealing" that content? I don't mean piracy, I mean keeping that content locally even after a subscription has terminated and possibly duplicating it for other people. I would assume some sort of online verification process even if the content isn't actually being streamed in real time, but that still requires a connection sometimes.
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Jul 15, 2019 17:14
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It's trivially easy to have downloaded content expire/delete after a reasonable amount of time without a check-in requiring an internet connection. The average usage pattern for this type of offline viewing is something like someone on a plane or a car trip, not archiving a multi-month collection for your trip to the ISS.
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Jul 15, 2019 17:22
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JustJeff88 posted:How do they keep people from "stealing" that content? I don't mean piracy, I mean keeping that content locally even after a subscription has terminated and possibly duplicating it for other people. I would assume some sort of online verification process even if the content isn't actually being streamed in real time, but that still requires a connection sometimes. The downloads have varying expiration dates.
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Jul 15, 2019 17:22
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I feel way more secure just having a huge external hard drive with all my media on it. Shows, movies, music, it's all backed up there. If a service only lets me stream rather than having an actual file, it's off to torrent-town. If I could quickly buy cheap downloads to get "legitimate" files I would, but most don't offer that. The whole limited/subscription license system needs to die in both software and media.
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Jul 15, 2019 17:26
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HootTheOwl posted:I can't wait until there's too many streaming services and they have to start bundling themselves to be competitive and then we'll be dealing with cable 2.0 They'll all just merge together / get bought out and we'll just end up paying more for shittier service all owned by 1 or 2 companies, like capitalism intends.
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Jul 15, 2019 17:32
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Baronjutter posted:I feel way more secure just having a huge external hard drive with all my media on it. Shows, movies, music, it's all backed up there. If a service only lets me stream rather than having an actual file, it's off to torrent-town. You absolutely can! You can buy a Blu Ray and trivially rip an exact copy, with the added benefit of a digital download code that'll work across a ton of platforms if you want to stream it at any point. Music is even easier, with just about every major online platform willing to sell you DRM-free songs.
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Jul 15, 2019 17:33
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Morbus posted:They'll all just merge together / get bought out and we'll just end up paying more for shittier service all owned by 1 or 2 companies
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