E2243 - Netflix & Disney - October 26, 2022
E2243 - Netflix & Disney - October 26, 2022
This week we discuss the streaming businesses of Netflix, Disney, Amazon, and Google
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Easy Money
On this week’s episode we discussed Disney and Netflix. Before I get into those, I want to share a link to a book that Hunt mentioned during the Macro section of the call. The book provides some useful historical context to the Federal Reserve and a better understanding of how Quantitative Easing and Quantitative Tightening works. The book is called Lords of Easy Money.
Netflix, Disney & Aggregation Theory
This week we discussed Netflix and Disney. Both own and produce content, but their business models (until recently) were very different. Disney has recently become a streaming giant - in addition to its other businesses. I’ve provided the most recent quarterly filings for each company below.
Another concept to be aware of when it comes to streaming and content is Ben Thompson’s Aggregation Theory. Here’s Ben’s description of the Netflix business model as compared to traditional cable…
Previously, networks integrated broadcast availability and content purchases. Netflix modularized broadcast availability by making its entire library available at any time in any order
Netflix integrated content purchases and customer management, enabling a virtuous cycle of increased subscription demand and increased content purchase capability
If you are interested in streaming (or any internet business)I highly recommend checking out Ben’s writing on the topic.
With that, I’ll leave you with my favorite summary of aggregation theory is a stick figure drawing Ben posted years back…
Supplemental Data
1 SuperCompounders
2 Macro.
3 Energy
3.1 Oil & Gas
3.2 Metals Powered
4 Tech
Cloud Multiples - Check out the most recent edition of Clouded Judgement for the latest SaaS multiples.
Semiconductors
Semiconductor Industry Association Global Billings Report
Bureau of Economic Analysis Semiconductor Import / Export
Cryptocurrency
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