Netflix has been the top of the streaming food chain for as long as there’s been a streaming food chain. But as competition heats up, the service’s potential problems seem to be multiplying as well. Here’s a look at some of the red flags on the red N’s horizon, all of which sort of flow from each other like some TV-centric set of matryoshka dolls.

1. Everyone Else Is Making HBO-Like Shows Too

This is, in many ways, the root of all Netflix’s problems. They started off looking to become a better HBO, stole House of Cards away, and largely succeeded in their goal. 

It was a great strategy when they had a small number of originals too. 

But now everyone else is making HBO-like programming: Amazon, Apple, Hulu, Peacock, Paramount and of course the OG HBO.  

With dozens of HBO-like shows out there, nothing on Netflix seems all that unique anymore. 

This is an issue because the audience for HBO-like programming is pretty limited. It’s the opposite of mainstream. 

To their credit, Netflix has recognized this, hired people like Shonda Rhimes and Ryan Murphy to make more mainstream shows like Bridgerton, but their competitors are doing the same, and that makes it tougher for Netflix to stand out.

2. They Lost All Their Good Library Shows

Most of them, anyway. 

That’s something a lot of people miss–that while audiences liked Netflix’s original series, what really drew the love was the ability to watch episode after episode of Friends or The Office or Family Guy. Because especially in the old days, there was plenty of down time between bingeing a season of Narcos and then waiting for the next original to drop and then there were all those nights viewers just wanted to lean back with some comfort food TV.

Fast forward to August 2021, and their competitors have more and better comfort food TV–Paramount+ in particular–and that’s going to be a problem when viewers are deciding which services they can’t live without and which ones are okay to Friend Zone.

3. They Keep Cancelling Shows People Really Like

Netflix has inexplicably taken to cancelling shows with decent sized fan bases (and then some, e.g., Ozark) after just two or three seasons. I say inexplicably because it mostly serves to get them negative social media buzz from the fans of said shows.

There are a number of theories on why they do this.

The most likely is that they have determined that an additional season of the show would not get them more subscribers and that cancelling it would not cause them to lose many subscribers, while the same money, spent on a new series, would actually net them more new subscribers.

This is a different sort of math than ad-supported TV, where another season of a popular show is a great way to charge high CPMs against a known quantity.

The second theory, which seems a bit less likely, is based on the widely held suspicion that many Netflix shows have backend deals attached to them that reward the producers, cast and crew once the show hits a certain number of episodes. (This is to make up for the lost syndication and overseas income they’re not getting.) By cancelling the show early, they avoid making these massive payments.

Either way, they are depriving themselves of loyal fans and hell hath no fury like a fan scorned. 

But they’re also depriving themselves of something more–the ability to have the sort of 250 episode series that makes for great library content.

The reason Friends or Family Guy work as comfort food is that there are hundreds of episodes. So even if you’re bingeing nightly, it will be months, if not years, before you need to repeat an episode and having that many episodes to choose from is in many ways the essence of comfort food TV.

4. The Shows They Are Making Aren’t Very Good

There have been a lot of articles like this one, from Wired, about how Netflix originals are not very good anymore. 

This is not objectively true–they have plenty of hits–but subjectively it certainly feels that way and the memes sprout wings because they have so many misses. 

This is not surprising. 

In any creative endeavor, the hits will always be few and far between.

Add in the massive number of new series Netflix is rolling out, factor in the limited number of talented people creating shows for TV and it stands to reason that most of their new originals will suck.

But that’s not what the people paying thirteen dollars a month want to hear.

This was also less of a problem when Netflix was starting out and their bad shows were still a little better than most of what was on network TV and volume was such that the hits really stood out. Now, however, they are competing against other streaming services, all of whom are starting out themselves and thus have a lower percentage of bad shows, and that makes Netflix look worse by comparison.

5. They Don’t Have News Or Sports

But you know who does?

Their main competitors, Disney and DiscoWarner.

Disney has all that ESPN and ESPN+ programming, plus the NFL games they just got the rights to, plus ABC News, which is now streaming live on Hulu.

Discovery/Warner has the upcoming CNN+ and all those NBA games on TNT they can’t stream just yet but are no doubt planning to, plus Eurosport.

Peacock and Paramount+ have sports too, as well as their networks’ national news feeds.

This matters because the availability of news and sports, including local news and regional sports networks, is the main reason most people are sticking with some form of pay TV subscription.

When viewers finally do decide to cut the cord, the services that can give them entertainment, plus the news and sports they want, are going to be the ones they subscribe to. And Netflix is not in that bucket, meaning that it’s going to be easy to relegate it to the Friend Zone.

6. They Release Their Shows All At Once

Well, most of them, anyway.

This was not a problem when they had five original series. In fact, it was the opposite of a problem–it was an event. 

Bloggers would document their experiences bingeing new seasons of Orange Is The New Black, social media would be all abuzz, and the subject of the cocktail party “what episode are you up to?” was a given.

No more.

Now, Netflix has a massive wave of new series. All of which have but a few weeks to make a splash, much in the way that movies do. 

That’s a problem because their competitors, which generally release series on a weekly basis, have months to build up a fan base for their series and can promote new episodes every week. Netflix, which releases so many new series each week, can’t possibly do justice to all of them, no matter how carefully targeted their marketing is.

7. The Great Rebundling

Disney can give you a bundle of Disney+, Hulu and ESPN+. Discovery Warner is likely to do the same with Discovery+, HBO Max and CNN+. ViacomCBS has bundles for Paramount+, Showtime and others. And Amazon and Roku will sell you a bunch of niche services like Acorn and PBS.

Netflix has not had a need for any sort of bundling yet, though they do have deals with Comcast and other MVPDs.

But as consumers consolidate their viewing on streaming, bundles are going to seem like the way to go–if nothing else they’re easier and as noted, the Disney and Discovery bundles provide you with a full package of news, sports and entertainment, something Netflix cannot do.

Reality Check

None of the aforementioned is life threatening. More like dents in the teflon. Netflix is still the streaming service most people get first and give up last. But it’s going to get tougher to maintain their position as TV’s Golden Child as the competition heats up and Netflix’s unrivaled success becomes less and less of a sure thing.

Stay tuned.