02 Feb Why Netflix Needs to Buy Another Streaming Service [The Information]
(Above) Netflix’s Los Angeles headquarters located on Sunset Boulevard, Hollywood.
By Martin Peers
February 2, 2022 | If Netflix’s warning of sharply slower subscriber growth tells us anything, it’s that Reed Hastings needs a new formula. The Netflix co-founder built the company into the leading video-streaming firm with a low-priced offering in a new market. But Netflix is now the priciest offering in an extremely crowded market.
Without a change in tactics, Netflix risks becoming a slow-growing company that produces little in the way of cash—a fatal combination from an investment standpoint. To avoid that scenario, Hastings could break the mold and pursue a big acquisition, buying a rival TV company such as Paramount+ owner ViacomCBS. That would give Netflix an additional brand that offers lower-priced tiers of service, one of which carries ads, thereby diversifying its revenue.
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