Netlfix: New Boss Just the Same as the Old Boss?

One sturdy storyline is “new boss just the same as the old boss.” So it is that some observers criticize video streamers such as Netflix for raising prices, just as legacy cable TV suppliers do. 

That seems unfair, as it is a charge that could be aimed at all sellers of products and services over time, especially when inflation rates are higher. And find any publicly-traded company whose basic imperative is anything other than “grow revenue and earnings” every year. 

Also, except for Netflix, virtually all other public streaming services are unprofitable, which is one reason why prices are being raised. 

Of course, one might prefer that higher prices over time are accompanied by higher value as well. 

So when others might argue that streamers such as Netflix are facing greater risks of becoming monopolists with weaker value propositions for consumers, that is a greater risk only if Netflix cannot grow its value proposition. 

That again is a general issue with all potentially market-leading firms. “New and improved” is almost a necessity, over time. 

We might agree with those who argue the “lower prices overall” advantage of streaming services only sometimes seems to be the case. Since many, perhaps most, consumers buy multiple streaming services, “saving money” is often, but not always an advantage, compared to buying a single linear subscription. 

It might be fairer to say that the key advantage is “choice” rather than “cost,” as a rule. 

Sudy	Year	Sample Size	Recurring Cost per Service (USD)	Avg. Number of Services per Household	Total Spending per Household (USD)	Key Findings
Parks Associates	2023	10,000 US households	$12.40	3.2	$40	Households with higher incomes subscribe to more services. Gen Z and Millennials lead in streaming adoption.
eMarketer	2022	1,000 US internet users	$15.00	2.7	$39.50	Increased cost-consciousness leads to subscription stacking and “churning” (switching between services).
GlobalWebIndex	2023	120,000 internet users across 25 countries	$10.80	2.4	$26	Global adoption of streaming is rising, with regional variations in preferred platforms.
Statista	2023	2,000 US adults	$14.20	3.0	$42.60	Original content and exclusive programming drive subscription decisions.
Nielsen	2022	5,000 US households with streaming subscriptions	$13.70	2.9	$39.30	Cord-cutting continues, with younger generations relying solely on streaming.

We might also argue that streaming is to linear video as many other forms of “internet” content are to legacy forms of content: more on-demand; more user-generated; more platform-oriented; pull (algorithm driven) from push (linear packaging); more consumption of “stories” or “items” rather than specific media. 

In and of itself, higher prices over time are not unusual, nor specific to Netflix or other streamers. What will draw attention is inflation rates that are higher than “background” rates of inflation. 

One might note that video streaming retail costs have risen faster than the background rate of inflation since perhaps 2024. On the other hand, it is also fair to note that almost no streaming services are profitable at such rates, either. 

Providers still are searching for the better formula for a sustainable business model.