Om Talks Bebo, EA, Netflix on Yahoo TechTicker


[qi:032] Sarah Lacy was kind enough to invite me onto her show, “Yahoo TechTicker,” this week. We talked about a lot of stuff, including Bebo, the future of online advertising, Electronics Arts (s ERTS) and Netflix (s NFLX). Below are some bullet points. Click on the links to watch the videos:

  • Bebo launches a redesign; does it matter?: AOL bought a Corvette, put a new coat of paint on it and now wants everyone to believe they bought a Porsche. Facebook has won this race!
  • Does EA have the economy to blame, or itself?: It’s reliant on big, expensive Hollywood-style games, instead of more nimble social, mobile or Wii games. In other words, “We give them too much credit for being smart just because they are big.”
  • Why I like Netflix: The company understands that it’s in the business of delivering entertainment in the cheapest way — postal service today, broadband tomorrow. In our recessionary times, it is an affordable option.
  • Online ad networks — how bad will it get? Very bad, and yes that impacts us as well.

All videos are available on the Yahoo TechTicker web site if you’re interested in watching me pontificate about this stuff.



In Recessionary times — the option like torrents, bootlegs and online viewing sites such as megavideo are becoming more mainstream. In addition, you have left out which is fast becoming a juggernaut.
(as music so will movies)

on the legal side…
Two large trends — device convergence (movies on mobile phones), increased high-speed access in the U.S.

Netflix is an interesting company (tivo is an interesting company too, just not a good business–they both are lucky if they will be bought out.); however, they are in a sector that was contracting before the recession, and subject to massive competition from established tech heavyweights in the new area of competition.

You are neglecting the loss of the netflix competitive advantage — their mailing centers.
Sorry, but Netflix is not going to beat aapl and amzn when it comes to content delivery and that is where the game is headed.

Unfortunately, AAPL and AMZN both want a large slice of the content delivery market. You are also over-valuing AMZN’s commitment to movies — where is the AMZN advantage in net based delivery? AAPL has a hardware and software advantage. AMZN did the same “big push” for music — how did that end up for them? Bezos is an EXCELLENT salesman
amazon’s “search engine,”

amazon’s “music player,”

However, look at the fundamentals of the businesses and you see who has the cash, capability, track-record and pure will to win — that’s AAPL not AMZN. AAPL has built a new business model on music and movies, AMZN is dabbling to increase the size of their valuation (incr. their PE ratio!).

I don’t buy the Netflix “we will compete everywhere” to me this is a poor-man’s varnish on “we no longer have a competitive advantage anywhere”

Cable companies like comcast already have excellent on-demand services (and a LOT of subscribers — + local monopolies!) — it is really just the interface and library that needs work. To remove cable companies from the field of competition is a serious mistake — cable on-demand is up and running right now on digital cable boxes.

Tivo market-cap is like 700 MM. To have any shot, Netflix needs to swallow TIVO along with their IP folio now.

Now with the recession, I don’t see Netflix lasting as an independent company. You are over-valuing them b/c like tivo the company is an interesting one.

Om Malik


Respectfully, I think your comment seems to not take into account what i said on the video. essentially there are a lot of competitors and yes, netflix is going to be have to compete with all those other companies. of all of them, amazon is the only one with serious competitor potential. Regardless, netflix does “on demand entertainment” and they are taking a “We will work everywhere” and “with everyone” approach. That puts them in a good position.

@Ralph: Have you seen the growth of Facebook and how many people (non techies) that it has started to pull into its ecosystem. At this point, others are spinning their wheels and unless a new radical improvement comes up, well, FB is running away with it. As for Tabup, the company you are recommending, it is a mere toy and long way from being a blip on the radar. Moving on!


Wildly inconsistent — Facebook has “won” remember sixdegrees and collegeclub and theglobe?
remember yahoo?

You then go on to speak wonders of netflix? come on … netflix business model is d00med by iTunes, Amazon and Cable companies.


“Facebook has won this race!” For now, or at least until everyone moves on to something new. Remember GeoCities? How about Nettaxi? When was the last time you checked your MySpace page? NOT!

I’m a fan of TabUp is just getting started and are still in beta, collaboration tools in the form of widgets. Create Tabs to organize all your stuff in one place.

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