Netflix Sees YouTube, Not Disney, as Its Bigger Threat

Sam Blake

Sam primarily covers entertainment and media for dot.LA. Previously he was Marjorie Deane Fellow at The Economist, where he wrote for the business and finance sections of the print edition. He has also worked at the XPRIZE Foundation, U.S. Government Accountability Office, KCRW, and MLB Advanced Media (now Disney Streaming Services). He holds an MBA from UCLA Anderson, an MPP from UCLA Luskin and a BA in History from University of Michigan. Email him at samblake@dot.LA and find him on Twitter @hisamblake

Netflix Sees YouTube, Not Disney, as Its Bigger Threat
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Netflix's dominance in a crowded streaming market may be showing signs of waning, but chief executive Reed Hastings isn't worried about Disney Plus or any of the other streaming services nipping at its heels.

"Our largest competitor for TV viewing time is linear TV," Hastings said on Tuesday's earnings call. "Our second largest is YouTube, which is considerably larger than Netflix in viewing time. And Disney's considerably smaller."


Netflix's subscribers now number 208 million, more than double Disney Plus, its closest on-demand video subscription competitor.

Still, Netflix undershot its quarterly subscriber forecast for only the second time since the final quarter of 2019. With 4 million new subscribers, the 2 million shortfall was its second largest since 2016.

Chief financial officer Spencer Neumann ascribed the miss to COVID. He pointed to the "pull forward" of new subscribers in 2020 that led to the company's record growth last year and the simultaneous push back of key title launches into the latter half of 2021.

"It's super hard to, obviously, forecast quarterly subscribers in a typical quarter for us, and particularly hard in this particular environment," he said.

Sex Education Season 3 Announcement | Netflixwww.youtube.com

Netflix also revealed it plans to spend $17 billion on content in 2021, up from $11.8 billion in 2020 and $13.9 billion in 2019.

The company highlighted the ongoing growth of streaming in general and its strong content slate in 2021 as signs for longer-term optimism. New launches in the second of this year will include returns of popular shows "Sex Education", "The Witcher" and "Casa de Papel" along with new original films including "Red Notice" starring Gal Gadot and Dwayne Johnson and "Don't Look Up" featuring Leonardo DiCaprio, Jennifer Lawrence, Cate Blanchett, Timothée Chalamet and Meryl Streep.

With 35 Oscar nominations, Netflix continues its foray into film supremacy. As for its cinematic ambitions, Hastings said he believes his company has a lot of room to grow.

"We've been doing series longer and we're more dialed in about what is really big and what hits," he said. "We're getting there on film. Also on animation. Also on kids. Each of these have their own experience curve that we're progressing down."

Netflix's share price was down about 8% in after-hours trading on news of the subscriber miss and tepid expectations for the second quarter, predicting 1 million net additions, compared to 10 million in the same period last year. Hastings' worries about YouTube are well-founded. A study out earlier this week found that Gen Z is the only generation that ranks browsing the internet and engaging on social platforms higher than watching TV or movies at home.

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Snap Mandates Employees Work From the Office Four Days a Week

Nat Rubio-Licht
Nat Rubio-Licht is a freelance reporter with dot.LA. They previously worked at Protocol writing the Source Code newsletter and at the L.A. Business Journal covering tech and aerospace. They can be reached at nat@dot.la.
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Snap is the latest major tech company to bring the hammer down on remote work: CEO Evan Spiegel told employees this week that they will be expected to work from the office 80% of the time starting in February.

Per the announcement, the Santa Monica-based company’s full-time workers will be required to work from the office four or more days per week, though off-site client meetings would count towards their in-office time. This policy, which Spiegel dubbed “default together,” applies to employees in all 30 of the company's global offices, and the company is working on an exceptions process for those that wish to continue working remotely. Snap’s abrupt change follows other major tech firms, including Apple, which began its hybrid policy requiring employees to be in the office at least three days per week in September, and Twitter, which axed remote work completely after Elon Musk’s takeover (though he did temporarily close offices amid a slew of resignations in mid-November).

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