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  • Netflix has 21 million subscribers to its Internet streaming service for $7.99 per month.
  • Time Warner’s HBO has 28 million.
  • Amazon.com’s streaming service is free for Amazon Prime customers.
  • The Dish Network, a satellite operator, sells streaming movie subscriptions to its television subscribers.
  • Verizon is launching a similar service in conjunction with Coinstar’s Redbox.
  • And now Comcast has entered the market, offering Internet streaming video through its Xfinity Streampix, with content focused on older movies and television series reruns. Streampix will cost $4.99 per month for regular Comcast subscribers; it will be free to the more than 2 million subscribers who pay for a premium video service already.

The vast numbers of subscribers to each of these services exemplifies just how attractive the Internet streaming industry is. For now, Netflix still offers that best selection of shows and movies, but the other companies are quickly catching up.

But the source of differentiation in the coming years is likely to be what sort of unique content each service can offer. On this measure, HBO appears to be in the lead, because it has developed its own critically acclaimed shows for years. Netflix is playing catch up in this space, developing its own series such as Lillyhammer, a Mafia drama with Kevin Spacey.

Discussion Questions:

  1. What is Internet streaming video?
  2. Why is Netflix making its own video content?

Source: Sam Schechner, “Comcast Takes Aim at Netflix,” Wall Street Journal, February 22, 2012.

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