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Why Netflix's Soaring Subscriber Base Isn't Necessarily Bad News for Competitors

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Why Netflix's Soaring Subscriber Base Isn't Necessarily Bad News for Competitors

Netflix Inc. (NASDAQ: NFLX) said Tuesday that it surpassed the 200-million-member milestone.

In comparison, The Walt Disney Company's (NYSE: DIS) Disney+ boasts 86.8 million subscribers, while Roku Inc. (NASDAQ: ROKU) reported 46 million and FuboTV Inc. (NYSE: FUBO) 455,000 subscribers.

Why It Matters: This doesn't mean that Netflix is taking over the market. The average American subscriber pays to view content from 3.4 different streaming services.

With this in mind, the battle between competitors is primarily fought over the content that customers can access from each service. This comes down to licensing agreements and whether competing services can snag the same deals.

Alternatively, services licensing their content to competitors is a possible next step in the quest to increase revenue.

What's Next: When Roku, Disney and Fubo report earnings over the coming weeks, investors will be looking to see if they too have increased their subscribers exponentially.

The newer, lesser-known services such as Roku and Fubo have room to grow as these companies work to become household names.

Although 2021 will likely see more streaming services become available, the big players in the market have a first-mover advantage.

With cross-service licensing deals possible in the future, the competition may come down to monthly subscription prices.

Photo courtesy of Netflix. 

 

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