Netflix Fatigue: Too Many Streaming Services, Too Much Consumer Choice?

Hulu, Prime Video and Netflix up against newbies Apple and Disney



Kindra Cooper
03/29/2019

Netflix fatigue

When New York Magazine reporter Josef Adalian asked Ted Sarandos, chief content officer at Netflix, about the company’s future plans, he might as well have said: “Define capitalism.”

Sarandos’ response: “More shows, more watching; more watching, more subs; more subs, more revenue; more revenue, more content.”

It sounds almost poetic, but as a prolific Netflix binge-watcher, I feel rather like a guinea pig on a wheel. Given the streaming service’s aggressive spending on original content – 700 new shows were added in 2018 alone – even casual observers are starting to notice that the firehose of content is approaching excess. And Sarandos’ equation isn’t airtight.

What’s going on in Netflix’s mind?

More time spent watching Netflix by current subscribers doesn’t pad the company’s bottom line – unlike ad-supported social networks like YouTube and Facebook that make more money the more time you spend browsing (leading to a phenomenon known as “attention hacking”). What’s more, Netflix doesn’t seem to have mastered the balance between revenue and content. Last year, the company spent $8 billion on content despite still running on borrowed money (Netflix is reportedly $4.8 billion in debt).

Netflix fatigue“If Netflix thrives on subscriptions and it’s the buzz around individual shows and movies [...] that drives signups, what’s the point of churning out more programming than you can effectively promote?” writes TIME TV critic, Judy Berman.

Critics like Berman have been exchanging bets on what might be going through Netflix’s mind. Overspend on programming now, command cult-like customer loyalty and jack up subscription prices later? Take “more is better” to the extreme and treat art and entertainment purely as a numbers game to outrank Hulu, Prime Video, and edge out new entrants like Disney and Apple TV?

Theory 1: Ditch them, not us

Most likely, Netflix’s strategy is more educated than throwing money at an imminent competitive threat. Most consumers are now juggling subscriptions to multiple streaming services, and it’s becoming burdensome to keep track of separate login credentials, monthly fees and trying to remember whether The Marvelous Mrs. Maisel runs on Prime Video, Hulu or Netflix. 

Netflix likely anticipated the onset of “subscription fatigue” and proceeded to bulk up as a one-stop content hub for unscripted shows, movies and TV, so that by the time streaming exhaustion hits, you’ll do the "right" thing and ax your other subscriptions and keep Netflix, because you’re convinced you can never run out of things to watch.  

Theory 2: Worldwide domination

OR it might in fact be a manic scramble to be all things to all people following an aggressive international expansion into the Asian market – and Disney pulling its programming after announcing a streaming service of its own, Disney Plus. At the UBS 46th Annual Global Media and Communications Conference, Sarandos said the initial push into Asia wasn’t localized by any means.

“We had enough high-profile shows with enough desire to see them that we could actually launch the service in these multiple territories on the strength of just the original programming and a handful of globally licensed shows.”

Read more: Uber on Creating a New Global Experience Through Rebranding 

Once Netflix penetrated that market, it began iterating with “original programming and local licensing” to appeal to local tastes. Our TV-watching preferences are shaped by personal, cultural and social forces, so it makes sense that each new market Netflix enters is “radically different from one another,” as Sarandos put it, hence the craze to diversify programming to the nth degree.

By taking on a global market, Netflix is shouldering a challenge no other streaming service has encountered. Hulu is exclusively available in the USA and Japan. Prime Video streams in over 200 countries, but it’s safe to say that TV shows aren’t Amazon’s bread-and-butter.

What about the user experience?

Netflix fatigueOn the user experience side, how much content is too much? Choice is considered the ultimate luxury, but excessive choice is a scientifically proven stressor, according to the “paradox of choice.”

A 2016 study by Reelgood and Learndipity Data Insights showed that the average Netflix subscriber spends 18 minutes deciding what to watch, twice as long as the traditional TV channel surfer. That’s a lot of deliberation – nearly equivalent to one episode of Parks and Recreation.

One could argue that if Netflix’s recommendation engine is all it’s cracked up to be, users can just skim the top layer of the 14,835 titles available on Netflix, the same tip-of-the-iceberg way many of us live our lives, and disregard the opportunity cost of tens of thousands of alternatives forgone.



RECOMMENDED