Netflix and YouTube are radically different businesses.
- Netflix and YouTube are radically different businesses.
- Netflix saw the power of internet video distribution years before it was possible, and built a toehold business to pull themselves up into it.[ze]
- They created a proprietary catalog of differentiated shows.
- Well, they used to be differentiated, now it's regressed to the mean and their average new show is only a few notches above slop.
- But now lots and lots of media properties have streaming services.
- Back at the beginning, the percentage of people who had at least one streaming subscription and didn't have a Netflix subscription was miniscule; presumably now it is way higher.
- Netflix catalysed a new market that is now saturated.
- An inherently sub-linear business.
- The business value derives entirely from linear investments the owner makes.
- It stands out from the crowd only at the beginning.
- Contrast that with YouTube, which is a bottoms-up content ecosystem.
- YouTube has no direct competitor.
- Although adjacent categories like Instagram Reels / TikTok exist.
- Its inherent network effects make it so no one else tries to take it on head on.
- A super-linear business, powered by an ecosystem.