Despite having over 100 million subscribers, tons of shows and movies, and creativity, Netflix seems to be drowning. While they are literally drowning in the sense that they are taking on water, they are drowning in $20.5 billion worth of debt. How does one company acquire that much debt? I guess it isn’t hard, but can they be saved?
You’ve probably got tons of questions, wondering what this is all about. Is your Netflix account safe? Will they go under? How did Netflix get into the mess? What’s the plan? What’s the grand scheme that Netflix has? Calm down, yo! We will answer your questions. That’s what we are here for.
As of now, your Nertflix account is safe. You’ve got nothing to worry about and this was never in question. With any risk one takes, there are bound to be leaps, fails, and successes. While there is no immediate danger that is flashing before our eyes that Netflix may tank, it’s possible. But that is business, right?
Let’s move on to bigger and better things, shall we? The plan… The glamorous plan that Netlfix has may surprise you. While their plan isn’t totally out of the box, they’ve got one brilliant plan on their hands. We’ll just have to see how it plays out.
Any who… The actual plan! Netflix plans to have over 50% of content that is original to Netflix, thus lessening the need for “outside” content. Netflix has spent billions of dollars, on licensing fees and outsourced content. Didn’t realize that content was so expensive, did you?
Just this year alone, they are spending over $6 billion just on programming. Six billion dollars. In pushing out this money, this vast amount of money, they are hoping to get a return on their massive spending. While spending this much does become risky as they may not get their return of investment, Netflix investors don’t seem to be worried on in an uproar.
So the main question… How did Netflix get in this mess? Simple, making their own content has cost them an arm and a leg. While it is expensive, it may be the way to cut down on spending in the long run. While original content is a long term investment, years and maybe decades in the making, Netflix hopes to come out in the positive in the long run.
While Netflix has not commented on this matter and they may not be going under, they may have bitten off more than they can chew with this game plan, but it is exciting to see them grow with their creativity and with their original content. What are some original content ideas you’d like to see? Suggest the titles that you’d like to see here.