What Future Roles Could Netflix Play?

Cable operators and other multichannel video providers, as well as studios and networks, now are worried about Netflix. Some investors and analysts are worried about Netflix as an equity. One might say Netflix is a marketplace, like Amazon or eBay. That's basically another way of saying Netflix is a distributor, a middleman between sellers of content and buyers of content.

Some might argue there are other possible roles for Netflix that do not cause concern in other parts of the video ecosystem. If Netflix were part of the payments ecosystem, for example, would it be the retailer, the buyer's bank, the retailer's bank, a settlement bank or a settlements processor?

Right now, you'd probably say Netflix is the retailer, a distribution channel for content creators and packagers, and buyers of content. One might speculate that a better long-term model if for Netflix to become a settlements processor, getting out of the retailer role. In other words, Netflix would cease to be a retailer (not Best Buy or Amazon or eBay) and become Visa or MasterCard, a processing network that basically deals in messages that instruct issuing or acquiring banks where and how to settle payments, but not dealing with the actual payments themselves.

You can decide for yourself how difficult it would be for Netflix to change in that way, and how others in the video ecosystem would react.

Visa: Netflix's Future