What Netflix's Biggest Competitor Is, According To The CEO


Showbusiness is exactly what the name would suggest: a business. Content providers are in constant competition to bring audiences the best possible product while also looking out to see what other services are providing. While conventional wisdom would seem to dictate that Netflix's biggest competition is other streaming services like Amazon and Hulu, it now appears that Netflix insiders consider the biological need for sleep to be their biggest obstacle in business. Netflix CEO Reed Hastings explained:

You know, think about it, when you watch a show from Netflix, and you get addicted to it, you stay up late at night. We're competing with sleep, on the margin. And so, it's a very large pool of time.

Reed Hastings' recent comments during a Netflix Investor Relations interview (via The Guardian) serve as a bit of a head scratcher, but the basic idea is pretty simple. Netflix mastered the art of the binge watch formula when it started providing full seasons of streaming TV series and movies, and the biggest competitor to grabbing the attention of its consumers it the fact that people need to stop watching to get some rest. He's clearly using hyperbole to make a point here, but the throughline of what he is trying to say is fairly obvious: Netflix's biggest hurdle is the endeavor to make its services 24/7 constant for its users, and that's impossible when humans biologically need to spend at least one-third of their lives asleep.

It's certainly surprising to learn that the CEO of Netflix feels this way -- particularly when we have seen theoretical competitors like HBO and Hulu make such vast strides in recent years. The rationale for this mentality seems to be the notion that the content market is vast enough to accommodate all of the existing providers, while preventing them from cannibalizing one another. The success of Hulu, HBO, or Amazon doesn't necessarily present any specific problems for Netflix; and if anything, the rising tide of people making the jump to streaming content raises all ships. Reed Hastings continued:

And so Amazon could do great work, and it would be very hard for it to affect us directly. It's just --- home entertainment is not a zero-sum game. And again, HBO's success, despite our tremendous success, is a good way to illustrate that.

That said, Netflix has still looked for new and innovative ways to find its own brand of content and corner certain markets in the entertainment landscape. In particular, the behemoth streaming service has shelled out a small fortune scooping up stand-up comedy specials from heavy hitters like Dave Chappelle and Louis C.K. over the last few years. Netflix hasn't started to worry too much about competition from others, but that doesn't mean that it hasn't been competitive. We will just have to wait and see where the streaming industry takes these platforms next.

Conner Schwerdtfeger

Originally from Connecticut, Conner grew up in San Diego and graduated from Chapman University in 2014. He now lives in Los Angeles working in and around the entertainment industry and can mostly be found binging horror movies and chugging coffee.