The Streaming Revolution in Global Media and the Down of an Epic Battle

Thorsten Feix
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Thorsten Feix: Augsburg University of Applied Sciences

Chapter 4 in Valuing Digital Business Designs and Platforms, 2021, pp 173-224 from Springer

Abstract: Abstract One of the most fascinating empirical cases on digital disruptions reshaping the strategic rules of competition within an established industry is global entertainment. The streaming revolution exposed even media behemoths like Disney to a “digital tsunami” which triggered a spectacular investment boom, comparable with the railways in the 1860s or the car industry in the 1940s. Netflix is nowadays the global market leader in film streaming, having lured more than 200 million subscribers on its platform. Netflix’s 10C Business Design will be benchmarked with Disney’s lately strategy revitalization by its multi-billion 21st Century Fox (TFCF) acquisition and the introduction of its own streaming platform Disney+. After the discussion of the different Business Designs of the streaming endgame contenders, the strength of subscription-based video-on-demand (SVoD) platforms is assessed by applying again the eight platform value drivers, as defined within Chap. 1 . Besides the mandatory investments to scale technologically entertainment platforms, also significant content investments (originals) are part of most streaming platforms’ DNA. Such investments are in contradiction to the typical asset-light characteristic of platforms, but are a crucial ingredient of their competitive advantage. The Reverse DCF valuation of Netflix, embedded in “the streaming gambit” picture of the future, supplements the discussion of entertainment streaming platforms.

Date: 2021
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DOI: 10.1007/978-3-030-83632-0_4

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