Follow Netflix’s rise from tech startup to media giant rivaling Comcast
2 weeks ago admin2 0
Netflix is now bigger than Comcast and can set its sights on Disney.
When the web-video giant began renting movies by mail 20 years ago, its largest competitors were video chains like Blockbuster Video that sold and rented DVDs. Netflix has gone from a Silicon Valley startup disrupting the way video is delivered to one of the biggest buyers and producers of TV shows and movies around the world. The company plans to spend more than $8 billion on content in 2018, nearly three-quarters of its prior year revenue, and another $2 billion to market those programs. “Objectively, we’re much more of a media company in that way than pure tech,” CEO and cofounder Reed Hastings said on an April conference call (pdf).
Netflix’s rivals are now media mammoths like Disney, Time Warner, and Twentieth Century Fox that have been around a lot longer than it has. But Netflix, with 125 million members and counting, is growing much faster. It surpassed Fox and Time Warner by market capitalization in 2017. On May 8, it overtook cable company and NBCUniversal parent Comcast as its market cap closed at $142 billion compared to Comcast’s $141 billion, FactSet data showed. Netflix was still leading Comcast on May 9.
Comcast’s shares slipped this week after reports revealed it intended to block Disney’s planned merger with Fox by making its own bid for the company. Netflix, meanwhile, saw gains on analyst speculation that Microsoft could acquire it and an overall lift in US tech stocks.
Netflix is now within striking distance of Disney’s $150 billion market cap. The competition between the two media giants has only been intensifying. Disney is pulling its movies from Netflix to launch a streaming service of its own next year. And Netflix has been poaching top showrunners such as Shonda Rhimes, who produced Scandal and Grey’s Anatomy for Disney’s ABC, and Ryan Murphy, a long-time producer at Fox, from other networks. It also bought a mini-Marvel of sorts in comic-book publisher Millarworld.
Give it a few years, and Netflix may even find itself up against tech-and-media juggernauts Amazon, Alphabet, and Apple.
Read next: In the battle between Netflix and everyone else, investors are betting heavily on Netflix