The new Netflix

To what extent is Netflix changing as it moves away from movies and toward original television programming, and what kind of business is it really now? Netflix's shift toward original television series programming is an unsurprising and logical step for any similarly situated online entertainment content provider. Amazon is following in Netflix's footsteps. Consistent with today's independent-minded spirit of the Internet and social media in general, Netflix can position itself as an innovative creative patron for more artistically-minded, original, socially relevant content creators, producers, writers and artists, and at the same time not entirely rock the boat by ostensibly competing out of the blocks with existing established national television networks and content providers for the same fan base. Netflix's adaptation thus creates the potential for both a financial and perceptional "win-win" proposition.

Netflix's transition, however, raises a much broader technological, socioeconomic and artistic question: Is the new Netflix model simply the next chapter in the inevitable evolution of innovative and different ways to deliver original content or does not it portend a full scale original television programming revolution destined to impact and force overall changes within the entire traditional entertainment business paradigm, ready or not, like it or not.

For much of Netflix's prior corporate life, its business model consisted of traditional studio and network programming and back catalogs. It was the first subscription streaming service to gain widespread adoption. As Netflix increasingly shifts away from movies and toward the creation and production of its own original television content - critically acclaimed original programming such as "House of Cards," "Orange Is the New Black," "Unbreakable Kimmy Schmidt," and "Bloodline" - networks possess legitimate fears that traditional roles will eventually be turned on their heads. Netflix's shows are all available on demand without any advertisements and can be watched either episodically or as a full season immediately after they are made available. Network Armageddon will come to pass when Netflix acquires enough market power to act as the ultimate programming guardian to the consuming public, compelling studio and network dependence upon Netflix to provide content to existing and new watchers, rather than vice versa. Such a reality would completely remove advertisement dollars from the mix, the lifeblood of any traditional television studio or network.

The traditional entertainment industry, while ostensibly maintaining a brave face, is showing evidence of changing with the times. Networks have started to air less commercials to appease their younger audience demographic and compete with the Netflix model. There is also a growing movement by cable companies to shift their network television shows to on demand platforms provided by the cable companies themselves, as opposed to providing them to Netflix, as done in the past.

Despite the challenges posed by online streaming services such as Netflix and Amazon to traditional networks, all may not be lost. Branded streaming is making its way out of different television networks, such as NBC and CBS as standalone versions of individual apps that they provide to cable customers. Consistent with the HBO Now model, HBO did not see a decrease in its other revenue sources, such as cable subscriptions. Traditional networks can look to the HBO Now model with optimism. Moreover, even Netflix itself admits that it and other new online streaming platforms cannot compete with the networks in the highly lucrative area of live broadcasts, such as the Super Bowl, the Olympics, the Academy Awards and shows such as "American Idol," annual and consistent television content that has been a financial cash cow and staple source of network programming for time immemorial and shows no sign of slowing down in either the near or distant future.

Some network executives in traditional network television find comfort by Nielsen ratings that seem to show that of the approximately 40 hours of weekly American television consumption, only 3 hours are viewed on mobile devices or computers. Nielsen executives admit, however, that it cannot accurately survey viewers under the age of 13. Moreover, this does not account for young viewers who may be watching television on their parents' mobile devices and will eventually grow into the habit as they acquire their own.

Finally, some prognosticators maintain that Netflix is wrong and the traditional network linear television model will not only survive, but prosper in the age of Internet delivery. They cite to online content providers that provide a traditional linear experience, with many channels to select from, and each with its own programmed schedule to fill the need for "white noise" while people live their everyday lives. Advocates argue that such content providers are a much better fit than the Netflix model for the casual viewer who simply wants television playing in the background while getting ready for work or looking for a mild distraction, rather than zealously focusing upon the next episode of their favorite show or engaging in a weekend-long, 12-episode series "binge viewing" marathon. In a very real way, Netflix's value add of automatically and sequentially broadcasting episodes one immediately after the end of the other is simply an individualized form of a linear channel viewing experience.

Netflix's continued emersion and substantial financial investment in the original television programming space will make it less reliant on traditional networks' content and back catalogs, as well as create a new era of creative and artistic freedom and independence. Netflix is far ahead of the curve of its traditional network counterparts, but every action has a reaction, and the old guard will not give way to the new without putting up a good fight. Traditional networks continue to maintain a stranglehold on consistent highly lucrative television revenue, generating sources such as live events, particularly sports. Competition will continue to breed invention and innovation on all fronts.

A beautiful ancillary benefit of all of this technological and commercial competition will be the change, growth and birth of even more content providers and forums, both traditional and non-traditional, that allow artistically-minded, original, socially relevant projects to be shown to the masses, and gifted artists to share their talents, which are the core values and goals that should ultimately lie at the heart of the "business" of entertainment.