Video streaming, what if Microsoft bought Netflix?
To win the video streaming war, offering on-demand content is no longer enough. Unlike Disney, Apple and Amazon, Netflix only relies on its platform. And an acquisition by tech giant Microsoft, its new advertising partner, may just be its best hope, according to Quartz.
What if after the partnership with Microsoft, Netflix was acquired by the tech giant from Redmond?
Let's take a step back.
The video streaming platform reported better-than-expected Q2 2022 results last week . Netflix's quarterly update last April saw its first decline in paid users in over a decade. And if at the time the Los Gatos company admitted that it expected to lose another 2 million subscribers in the second quarter, it did not. Not only that, it said it plans to add 1 million subscribers in the third quarter.
Undoubtedly thanks to the highly anticipated last season of Stranger Things that the platform released at two different times: the first part at the end of May during the second quarter and the last two episodes at the beginning of the third quarter.
Yet despite the aforementioned Strger Things along with the other titles from the likes of Squid Game and Bridgerton, growing competition from the likes of Disney +, Apple TV + and Amazon Prime Video has highlighted some of Netflix's weaknesses points out Quartz .
So much so that Netflix has confirmed that it is partnering with Microsoft as a "global sales and advertising technology partner" to launch a cheaper ad-supported subscription. In the wake of that decision, experts are wondering if Netflix might have something up its sleeve.
Needham analyst Laura Martin suggested that Microsoft isn't necessarily the best choice for an advertising partner, as it has been in the digital advertising business for about a month. Therefore there may be a "secret agenda" regarding a possible acquisition.
All the details.
THE COMPETITION WITH DISNEY, AMAZON AND APPLE
As Quartz pointed out, in the new video streaming landscape, simply offering on-demand content is no longer enough. Disney has its own theme parks, theatrical movie franchises, toys, and a host of licensing deals for brands; Apple has its own hardware and software links, and Amazon isn't just the leading ecommerce store, it's also the cloud provider of some of the largest companies on Earth, including Netflix.
THE NETFLIX-MICROSOFT PARTNERSHIP IN THE ADVERTISING SECTOR
So while the streaming business is crowded with tech giants with the ability to add ancillary value to its customers and shareholders, Netflix's relative lack of diverse business operations has gradually transformed its profile from a prime tech innovator into a one-size-fits-all business. notes with an uncertain future, underlines the American newspaper.
Hence, after the announcement of the advertising partnership between Microsoft and Netflix, the question arises whether the agreement is not the prelude to something bigger.
SPECULATION ON A POSSIBLE ACQUISITION
The announcement of a deal with Microsoft to manage Netflix's upcoming ad-supported offering has fueled speculation that the collaboration is a precursor to an acquisition. "Microsoft could offer everything Netflix needs to outlive its rivals: a solid cloud architecture on Azure and a widely used desktop and mobile software platform on Windows," Quartz points out.
THE COMMENT OF THE ANALYSTS
And in recent days, analyst Needham Laura Martin has also suggested that "a hidden agenda at play here could be that Netflix wants Microsoft to buy them." According to the analyst, by choosing the least likely partner for advertising technology, Netflix has revealed its "hidden agenda" and that "it could be that Netflix is looking for an exit".
"So it could be that really the game is that Netflix is trying to get closer to Microsoft in the hope that after Microsoft assimilates the acquisition of Activision , the next step is the purchase of Netflix, which would be a complementary type of video content. premium video content, such as Activision is in the gaming space, ”concluded Martin.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/video-streaming-e-se-microsoft-comprasse-netflix/ on Mon, 22 Aug 2022 05:09:20 +0000.