We can all learn from competition, competitors, and knowing that you always need to look over your shoulder and continue to innovate regardless of your business.
Market Capitalization Results
It appears that strong competition has been able to decrease a competitors net worth by over $7 Billion. Between my first writing about Netflix and Valuations on 7/18/11 ($14 Billion) to today the difference in the Netflix (NFLX $6.7 Billion) overall market capitalization is $7.3 Billion. I cannot say that competition alone has resulted in the drop of Netflix’s value, however one could assume it may be a large part.
Google has taken on Facebook and now Amazon continues to up the ante against Netflix. This is fascinating to watch and truly is competition at it’s best. In my opinion, as I am a paid subscriber of both Netflix and Amazon’s streaming service, everyone wins. By everyone I am referring to the customers and not the investors.
Amazon Strikes Another Big Deal
From the founder of Amazon, Jeff Bezos, there was a letter on their homepage. I have taken a couple pieces that outlines their current deal and the overall service they currently offer. This is in direct competition with Netflix.
I have big news for Amazon Prime members – we’ve just signed a deal with FOX to add a broad selection of movies and TV shows to our unlimited instant streaming service later this fall. The new additions from the FOX library include 24, Arrested Development, The X-Files, Ally McBeal, Buffy the Vampire Slayer, and – available on digital video for the first time – The Wonder Years. We now have deals with CBS, NBCUniversal, Sony, and Warner Bros, and adding FOX will bring the total to more than 11,000 movies and TV shows available for unlimited instant streaming. … Prime instant videos can be played on more than 300 HDTVs, Blu-ray players, and set-top boxes. … You can also watch movies and TV shows instantly at our Amazon Instant Video Store, where we offer more than 100,000 movies and TV shows for rent or purchase, no Prime membership required.
Congratulations to Amazon and I should add as I am a user of Netflix I hope they continue to strike positive deals for their service as well. Watching this battle can teach us a lot. It is amazing to see how one company can fall behind in the competition and lose half of their companies value. In my opinion competition spurs constant innovation, be sure to keep an eye on your businesses competition and be sure to constantly innovate.