One thing I’m starting to see more and more is that software is no longer as big of a moat as it once was. Netflix gets to cruise along with a tech like evaluation because it pioneered online video streaming software. They caught the incumbents off guard and now the incumbents are starting to chip away at their tech moat.
I think we’re going to start seeing this happen more broadly across the industry. AI will get to a point where it becomes easy to clone any app or service. At that point software is no longer your moat. Your moat is going to be content, community and branding. This kind of makes me wonder if open source get even more popular. If software is no longer a moat, then you may as well release it for free and cash in on the goodwill and community.
Not gonna happen software being cheaper simply moves the goalpost farther than before. Customers will expect and demand even greater capability and quality.
A team of highly skilled engineers at netflix are gonna beat you massively at their own game.
Acting like all code is flat and you just have to catchup to their level is false thinking. Netflix will be running 100x more AI than you with much better talent than you.
All that matters is that the CDN is good enough to serve viewer traffic. If your CDN isn't up to snuff, the outcome is that the viewer can't play the video they want. AFAIK, no Netflix competitor is suffering from insufficient CDN resources.
Sure, some choices make the cost of CDN higher or lower, but it's not material enough of an impact on competitors to matter.
The actual moat for streamers has been, and always will be, the breadth and popularity of their exclusive content. Netflix will die if they don't continue to produce exclusive content that audiences will subscribe for.
Everything about a cdn is cost per MB, and Netflix has that priced at I don't know, I imagine almost zero, and maybe negative because they host with ISPs, which other cdns can't do. Which means their competitors must spend infinitely more money until they hit a scale where they can start to follow in Netflix's parh. Also, I imagine that buying hardware now, especially DRAM is four or more times as expensive as it was when Netflix paid for a lot of their hardware, so yeah, that.
It’s easy to forget now that Netflix Original used to be a marker of quality. Losing Holland was an unforced error.
One thing I’m starting to see more and more is that software is no longer as big of a moat as it once was. Netflix gets to cruise along with a tech like evaluation because it pioneered online video streaming software. They caught the incumbents off guard and now the incumbents are starting to chip away at their tech moat.
I think we’re going to start seeing this happen more broadly across the industry. AI will get to a point where it becomes easy to clone any app or service. At that point software is no longer your moat. Your moat is going to be content, community and branding. This kind of makes me wonder if open source get even more popular. If software is no longer a moat, then you may as well release it for free and cash in on the goodwill and community.
Not gonna happen software being cheaper simply moves the goalpost farther than before. Customers will expect and demand even greater capability and quality.
A team of highly skilled engineers at netflix are gonna beat you massively at their own game.
Acting like all code is flat and you just have to catchup to their level is false thinking. Netflix will be running 100x more AI than you with much better talent than you.
Netflix's moat is their CDN, which is fabulously expensive and complex hardware scattered across the entire planet.
AI isn't gonna help you magic a CDN into existence
How is that a moat?
All that matters is that the CDN is good enough to serve viewer traffic. If your CDN isn't up to snuff, the outcome is that the viewer can't play the video they want. AFAIK, no Netflix competitor is suffering from insufficient CDN resources.
Sure, some choices make the cost of CDN higher or lower, but it's not material enough of an impact on competitors to matter.
The actual moat for streamers has been, and always will be, the breadth and popularity of their exclusive content. Netflix will die if they don't continue to produce exclusive content that audiences will subscribe for.
Everything about a cdn is cost per MB, and Netflix has that priced at I don't know, I imagine almost zero, and maybe negative because they host with ISPs, which other cdns can't do. Which means their competitors must spend infinitely more money until they hit a scale where they can start to follow in Netflix's parh. Also, I imagine that buying hardware now, especially DRAM is four or more times as expensive as it was when Netflix paid for a lot of their hardware, so yeah, that.
Do you seriously believe Apple and Disney are going to lose to Netflix over CDN costs? If so, let's place counterwagers.