Can Netflix Become Disney Faster than Disney Can Become Netflix?

To a larger degree than might be immediately obvious, the new Netflix challenge might be whether “Netflix can become Disney faster than Disney can become Netflix.”


Source: Nano Banana generated image

It might appear that the prior challenge (since the 2013 to 2015 period), for Netflix to "become HBO faster than HBO becomes Netflix," has mostly been achieved.

That statement encapsulated the business challenge of Netflix becoming a content powerhouse faster than HBO could become a streaming giant.

Netflix largely succeeded, and an acquisition of Warner Brothers Discovery, though a gamble, might help with the next challenge, which is for Netflix to diversify and broaden its revenue sources to maintain higher growth rates as the core streaming business slows.

And that is where the Disney challenge is relevant, as many expect future Netflix growth to rely on new sources such as monetization of intellectual property (merchandising, for example); theme park or other experiential revenue streams; while maintaining a successful original content creation and distribution mechanism.

"Total entertainment share" now becomes a relevant objective for Netflix, which can seek greater wallet share across advertising revenue; live sports programming; merchandise; gaming; events and bundles of products.

As it once was said that “Disney has the mouse,” so Netflix might hope to expand from content creation and distribution to leverage its intellectual property in various other venues, ranging from events and physical entertainment attractions to live sports and gaming.

Netflix revenue growth and profit margins might hinge on success in that effort.