Online streaming through services such as Netflix, Sky's Now TV and Amazon Prime is becoming more and more commonplace. It all but drove rental chains like Blockbuster out of business, and a new generation of ‘cord-cutters’ are now choosing to watch everything on-demand, with no traditional TV service at all.
In fact, 2015 saw more people sign up for the services than ever, with Netflix's membership base totalling almost 70 million in Q3 2015 and those using Amazon Prime (including its free Amazon Prime shipping service) adding up to 40 million by mid-year.
Meanwhile, Now TV had an estimated 729,000 subscribers in Q1 2015 but sets itself apart with access to sports programming such as football and Formula 1, which don't appear on Netflix or Amazon Prime.
Amazon Prime and Now TV may appear to be trailing behind the top streaming service, but they're catching up. In fact, Amazon revealed it added an additional 3 million members across its entire Prime division, including Instant Video and its express shipping service in the three weeks up to Christmas 2015, showing Netflix has a real battle on its hands.
But with Amazon Instant Video, Netflix, Now TV, Hulu, the BBC iPlayer and more all vying for your attention, how can you tell which one is the best? We put the two biggest players up against each other to find out.
18/10/2017: Netflix will spend $8 billion on its own TV shows and movies
Netflix said it's planning to increase investment in its Originals content arm, promising to spend $8 billion (£6.07 billion) on its TV shows and films in 2018, up from $6 billion (£4.55 billion) it has budgeted this year.
Films will take a majority share of the cash injection, while the company's Originals TV shows will take the rest. Netflix hasn't been specific about how much will be spent on each video type, but told investors that it hopes to release at least 80 exclusive films next year.
"We have a good head start, but our job is to improve Netflix as rapidly as possible ... to stay ahead of the competition in the decades to come," the company said in its earnings release on Monday.
Netflix's rising subscriber base has enabled it to invest more money in creating new content, where before it paid for the license to stream pre-made content. Increasing its subscription costs will also generate a substantial amount of extra revenue that could be used to finance the TV shows and films its users are asking for.
"It's really about slow and steady. We've been in no hurry," David Wells, Netflix's CFO, said when asked about the company's reasoning for increasing subscriptions from $9.99 to $10.99 a month. "Many investors have sort of criticized us in the past for being under-priced."
10/10/2017: Netflix is worth nearly $200 per share
Netflix's share values have increased substantially after the company increased its prices for some of its streaming plans.
Shares are now worth almost $200 apiece, pushing their value up 59% this year so far. Analysts think it's likely to keep increasing over the next two months too, possibly ending the year with gains of up to 65%.
JPMorgan analyst Doug Anmuth explained in a note that the share price increase came "sooner than expected, but we like that NFLX is taking a very different approach with rapid implementation putting the increase fully in place by December. We think there will be minimal negative impact on churn and overall gross adds given content strength and the continued disruption of linear TV."
When the new prices come in effect properly, which is set to happen from 19 October for existing subscribers, the share price could continue to increase, according to Anmuth. However, if the company reports lower than expected earnings on 16 October, this could cause the price to drop again.
"We believe this is also a positive read-through for 3Q subs as NFLX is more likely to raise prices from a position of strength," Anmuth added.
06/10/2017: Netflix bumps its prices up for the first time in two years
Netflix has increased its prices for the first time in almost two years, bumping up the cost of two of its three monthly subscription packages.
Netflix's middle tier, which allows users to stream HD content across two devices at the same time, will be rising to £7.99, up from £7.49.
The company's top tier, allowing up to four devices to stream 4K, will also increase from £8.99 to £9.99, although the 'basic' tier for one user will stay at £5.99.
"From time to time, Netflix plans and pricing are adjusted as we add more exclusive TV shows and movies, introduce new product features and improve the overall Netflix experience to help members find something great to watch even faster," the company said, in a widely reported statement.
"The price change will roll out to members over the course of the next several months."
The move is somewhat unsurprising given that Netflix remains relatively cheap compared to other services and traditional TV packages, despite the exorbitant costs the company incurs to secure the rights to the latest TV shows.
Netflix has recently made moves to bring more of the production of its original content in-house. Shows including House of Cards and The Crown, despite having a 'Netflix Original' tag, were produced by third-party companies, meaning Netflix is still required to pay out licensing fees.
Although services such as Amazon Prime and NowTV are available to customers in the UK, their libraries are comparatively limited, and over 5.7 million customers have flocked to the US-based service as a result.
27/09/2017: Will Netflix let you stream movies while flying?
Netflix reportedly wants to partner up with airlines to offer customers free TV and movie streaming while they're on flights.
Not only would this mean passengers can take advantage of Netflix's huge catalogue of entertainment while in the skies, it will also force airlines to improve their in-flight Wi-Fi services, meaning customers can take advantage of better connectivity across the board.
Netflix will implement its mobile streaming technology to airline companies around the world from 2018, according to Variety.
The service will be low-cost, allegedly saving airlines up to 75% compared to current in-flight services, and it's hoped these cost savings will be passed onto passengers, ensuring anyone can take advantage of it.
Netflix introduced the technology on Virgin America flights in 2015 and it now operates on Aeromexico, Qantas and Virgin Australia aircraft too. Passengers on flights equipped with next-generation Wi-Fi access, including Ka-band and Gogo’s 2Ku internet access are able to stream Netflix at no extra cost.
Now the company wants to offers its service to every operator, whether they have next-generation onboard Wi-Fi or not. The technology it has developed can deliver DVD-quality video on mobile devices at 250 kilobits per second, making it a much more efficient way of accessing media (using up to 36% less bandwidth) compared to conventional connections.
08/09/2017: Disney CEO confirms Star Wars, Marvel will leave Netflix
Disney's CEO Bob Iger has confirmed that highly lucrative franchises including Star Wars, and a host of Marvel films will be leaving Netflix to join its own streaming platform.
Following the announcement that Disney will be creating its own streaming service, Netflix has fought to retain the rights to host Disney-owned content, however it appears to have lost the battle, according to >CNBC.
"I have described a very rich, treasure trove of content for this app," said Iger, speaking to CNBC at a media conference on Thursday. "We're going to launch big, and we're going to launch hot."
He confirmed that in addition to the Star Wars and Marvel franchises, the new service will include at least four original Disney TV series, and up to four originally produced movies.
Disney first announced the platform during an earnings report in August, saying that come 2019 it would start pulling its content from Netflix.
The move is seen as a damaging blow to Netflix, which has created lucrative spin off series based on Marvel characters, such as Daredevil, Jessica Jones, The Punisher, and a new series called the Defenders, which ties a number of characters together. It's currently unclear whether the TV series spin-offs will eventually make their way to Disney's new service.
However there's a possibility that Disney's new service will launch internationally first, according to Iger, leaving a cross over period where US viewers will be unable to access the shows at all.
15/08/2017: Ex-ABC executive Shonda Rhimes has joined Netflix, with her production company Shondaland producing shows for the video streaming platform.
The "Grey's Anatomy," "Scandal" and "How to Get Away with Murder" producer will continue to create hit shows, but for Netflix rather than for ABC, which is where her stream of hits were first broadcast.
"Shonda Rhimes is one of the greatest storytellers in the history of television," Netflix's Ted Sarandos said in a statement. "Her work is gripping, inventive, pulse-pounding, heart-stopping, taboo-breaking television at its best. I've gotten the chance to know Shonda and she's a true Netflixer at heart."
Rhimes will continue to produce her current broadcast series with ABC and the shows will continue to be broadcast on the channel, but she will switch allegiance to broadcasting exclusive Netflix content instead, alongside her producing partner Betsy Beers.
She said in a statement she sees the move as an "opportunity to build a vibrant new storytelling home for writers with the unique creative freedom and instantaneous global reach provided by Netflix's singular sense of innovation. The future of Shondaland at Netflix has limitless possibilities."
Neither Netflix nor Shondaland revealed how much the deal was worth, or in fact, any additional details of the arrangement.
09/08/2017: Netflix has bought comic publisher Millarworld, best known as the publisher of Kingsman and Kick-Ass.
Although these and some other titles aren't part of the deal, the acquisition will mean Millarworld's writer Mark Millar and his wife Lucy, who co-runs the company, will join Netflix to produce some new content for the streaming service.
Although the deal doesn't include some of the most popular Millarworld content, it does include the rights to some lesser-known characters that Netflix will be able to use for new TV shows and films, the company said in the announcement.
“As creator and re-inventor of some of the most memorable stories and characters in recent history, ranging from Marvel’s The Avengers to Millarworld’s Kick-Ass, Kingsman, Wanted and Reborn franchises, Mark is as close as you can get to a modern day Stan Lee,” said Netflix's chief content officer Ted Sarandos. “We can’t wait to harness the creative power of Millarworld to Netflix and start a new era in global storytelling.”
Accoding to Netflix, this is only the third time in history a major comic book company has been acquired by another company. The biggest example of this was when Walt Disney bought Marvel.
“Mark has created a next-generation comics universe, full of indelible characters living in situations people around the world can identify easily with,” added Sarandos. “We look forward to creating new Netflix Originals from several existing franchises as well as new super-hero, anti-hero, fantasy, sci-fi and horror stories Mark and his team will continue to create and publish.”
31/07/2017: Although Netflix is enjoying record subscriber numbers and surging share prices, recent earnings reports shows the company is hemorrhaging cash with debts of $20 billion.
Since its launch twenty years ago, Netflix has gathered around $15 billion in short-term debt, although a recent push to create new original content has meant long-term debt almost doubled to $4.8 billion in 2017, according to a report by the >LA Times.
The company is pouring money into new original shows this year in an effort to drum up more subscribers, expecting to spend a further $6 billion on content this year alone.
Although it's a substantial amount, investors haven't been spooked just yet, as they appear to share the view that high spending will result in stronger growth and healthier results in the near future. Following the news of a better than expected subscriber count earlier this month, shares rose more than 10%, with stock prices up 50% for the year.
The vast licensing fees required for third-party content has forced Netflix to invest heavily in self-produced original content. However, a number of Netflix's most popular 'originals' are licensed and made by other studios, including Media Rights Capital's 'House of Cards' and Sony Pictures' 'The Crown'. Although the fees for such shows are undisclosed, it's thought they are increasing over time as studios look to protect their own business interests.
In an effort to create more self-produced shows, the company is trying to draw in some Hollywood A-listers, such as the upcoming film 'The Irishman', directed by Martin Scorsese and starring Sandra Bullock and Will Smith, which is thought to have cost $100 million to acquire.
Netflix, which unlike Amazon does not have a thriving retail business to help recuperate costs, says it wants self-produced shows to make up 50% of its content portfolio and as a result expects to be "free-cash-flow negative for many years", according to the report.
Sky to boost its streaming service to keep pace with rivals
Sky has said it will be adding 300 new technology roles to help the service catch up with the likes of Netflix and Amazon, at a time when it is struggling to retain customers and stem a profit bleed.
The TV broadcaster reported a 1.4% fall in operating profits, dropping to £1.3 billion for its operations in the UK and Ireland, a market that accounts for almost 90% of company profits. The fall is largely due to rising costs of Premier League fixtures, the rights to which cost Sky £629 million for the year ending June, and its £51 million investment into Sky Mobile.
Sky was able to add 280,000 new UK customers over the past year, selling over 1.6 million products. However, the rate of customers leaving Sky for rival streaming services rose for the same period, up from 11.2% to 11.5%.
To keep pace, Sky has said it will be hiring for 300 new technology roles, increasing its software engineering workforce by 25% across sites in Leeds, London and its main Sky Labs operation in Milan. The new hires will be responsible for further developing Sky's streaming capabilities, aimed at those potential customers who are unwilling, or unable, to have a Sky satellite dish installed.
Sky chief executive Jeremy Darroch, speaking to the >Guardian, said: "It is a competitive world out there. There is more movement between platforms [rivals] than in the past. We need to keep focused and keep executing our plans. We have good plans in place.
"Despite the broader consumer environment remaining uncertain, we are confident of delivering on the plans we've laid out as we continue to give our customers the best content, great products and industry leading service."
18/07/2017: Netflix shares surge as it hits 104 million subscribers
Shares in Netflix surged on Monday after the company said it had reached 104 million subscribers, a figure much higher than it had expected.
The company believes the results demonstrate that its continued investment in new shows is beginning to pay off.
Shares rose more than 10% in after hours trading, following the posting of its Q2 financial results. The company added more than 5.2 million subscribers during the second quarter, most of which were international.
Netflix has been bolstered by recent successful attempts to create region specific exclusive content, such as 3% and Club de Cuervos, Portuguese dramas produced in Latin America.
It has also been met with critical plaudits for films such as Okja, a Netflix original film from South Korean director Bong Joon-ho which garnered rave reviews when it premiered at this year's Cannes Film Festival.
The continued growth has resulted in a 32% boost in revenues, reaching $2.8 billion for the quarter. The company now expects to surpass $3 billion by Q3 2017.
Profits were also significantly higher for the quarter, up 60% year over year for the April to June period.
Netflix founder and CEO Reed Hastings described the news as "rewards for doing great content".
"The largely exclusive nature of each service's content means that we are not direct substitutes for each other, but rather complements," Netflix said, in a letter to its shareholders, seen by the BBC.
"The shift from linear TV to on-demand viewing is so big and there is so much leisure time, many internet TV services will be successful."
Membership and price
Netflix, Now TV and Amazon Instant Video all operate on subscription-based business models. Netflix supports up to five users per account, each with unique recommendations and viewing histories. Amazon similarly allows Prime customers to share their Instant Video account with another user by forming a ‘household’, although this is much less convenient.
Now TV lives up to its "Powered by Sky" tagline by offering various packages for individual prices. The Entertainment Pass – which includes 13 channels such as Sky 1, Sky Atlantic and Comedy Central - will set users back £6.99 a month, while a Sky Movies pass is £9.99 and a Sky Sports pass £6.99.
Both Netflix and Amazon Prime start at £5.99 per month, with higher tiers offering greater benefits. Netflix’s standard plan only allows the use of one screen at a time and restricts viewing to standard definition. For £7.49 per month, users can watch in HD, and on two screens simultaneously. The more expensive £8.99 plan ups that limit to four screens, and unlocks ultra-HD quality.
Amazon also offers tiered pricing, but in a slightly different way. While the basic Amazon Instant Video subscription is £5.99 per month, the cost of an annual Amazon Prime membership is equivalent to £6.58 per month.
For an increase of less than a pound, users get access to Prime’s unlimited one-day delivery (of eligible items from the Amazon website), music streaming service, and cloud photo storage. It’s also worth noting that users who don’t subscribe to the full Prime package won’t be able to share their benefits.
In terms of which presents the best relative value, it depends on the use case. For individuals, the extra 60 pence for one-day delivery means that Amazon Prime will likely save money in the long term.
For families, however, Amazon’s somewhat cumbersome account-sharing options are beaten hands-down by Netflix. It’s also great for flatmates – for less than £2.50 per person, a house of four could all use the same Netflix account simultaneously, with their own unique profiles.
Now TV likely has a different audience in mind, with viewers getting access to pay-TV channels without having to shell out for subscribe to a traditional Sky TV package. It's also the only option that airs live sports, as well as often adding the latest films a little before Amazon Prime.
Ways to watch
As the poster-child for the cord-cutting revolution, Netflix is available on basically everything with a screen. It’s available as an app for iOS, Android and Windows, it can be watched via the web browser, and it’s compatible with almost every streaming stick and smart TV.
Similarly, Amazon Prime Instant Video is accessible via a web browser, iOS and Android apps, and comes built into the company’s Fire devices. It's rollout for support of third-party devices was slower than Netflix's, but it's now available on most, if not all, smart TVs and streaming devices.
Now TV is not quite as ubiquitous, and isn't supported by Windows Phone, Kindle Fire tablets or Nintendo Wii. It is, however, available through the Now TV Box, Chromecast, Playstation 3/4, Xbox One/Xbox 360, Roku, YouView, LG Smart TV, PC, Mac, iOS and Android.
Amazon Prime and Netflix both allow you to download videos onto your device for watching later, so if you don't have a web connection, you can still watch your favourite programmes and films on the move.
The true test of a streaming service is its catalogue. In terms of movies, neither has a huge amount of the very latest blockbusters, largely thanks to licensing deals and the like, and both services suffer from a somewhat truncated selection compared to their US counterparts.
While there are various workarounds for getting US Netflix in the UK (and you can get US Netflix with your UK login while you're in the States), Amazon Prime US and UK use totally separate accounts.
This means that not only can you not trick your way into getting access to the US content, you also won’t be able to use your account outside of the UK, as each region is geo-locked. Netflix, thankfully, does not suffer from this problem.
The UK libraries of both offerings have a fairly equal amount of major releases, cult classics and hidden gems, as well as mountains of low-budget, straight-to-video affairs.
Gratifyingly, the options for TV are much better. Both have heaps of shows spanning all genres, with a mix of both current and older programming. Netflix has more British television, most of it made up of classic BBC sitcoms while Amazon has a wider range of US dramas, such as Mr. Robot, Scandal and The Walking Dead.
Netflix generally has a greater number of titles available than Amazon Prime, but the exact numbers are constantly changing as shows are added and removed. Considering that both platfomrs have well over 2,000 movies and TV shows, though, you're unlikely to be stuck for stuff to watch.
Now TV differs from the others primarily because of its live TV option, but otherwise has a smaller overall collection of both television and film. Additionally, it cannot boast original content, which puts it behind both Netflix and Amazon Prime. It is, however, the only service offering HBO's original programming (through Sky Atlantic) meaning that it's the only platfrom with shows like Game of Thrones and Westworld.
Netflix and Amazon Prime have both moved from simply curating content to actually creating it, commissioning original TV shows exclusive to their service. Both have produced critically acclaimed work, with star-studded productions like Netflix’s Orange is the New Black and Amazon’s Transparent racking up awards wins.
Netflix has more high-profile successes under its belt in this instance. House of Cards, Arrested Development and Master of None have all been met with widespread approval. The company also has an exclusive partnership with Marvel’s money-printing cinematic universe, creating TV series for Daredevil, Jessica Jones, Luke Cage and Iron Fist.
Amazon’s catching up fast, though. The adaptation of Phillip K. Dick’s classic story The Man in the High Castle has also been very well received and recently aired its second season, and The Grand Tour has proved popular with fans of Top Gear. Currently, however, Netflix has more original programming in the ‘must-watch’ bracket.
Judged purely on their merits as digital streaming services, Netflix is better than Amazon Prime. It’s generally got a slightly better-quality selection, you can watch it on devices like the Chromecast, and it’s been hitting its original programming pretty consistently out of the park.
However, the inclusion of all Amazon’s extra services in one subscription for under £7 per month is nothing to be sniffed at. Many people would be perfectly happy to spend that much money on the unlimited next-day delivery alone, so the inclusion of Prime Instant Video as an essentially free bonus is a very, very good deal indeed.
Now TV has its own benefits, such as a focus on live sport and a commitment to including the most up-to-date movies of the three. Mostly, however, it is a good alternative to standard Sky TV packages. Those looking for the latest blockbusters would do well with the Sky Movies pass, for example.
While we’re dubbing Netflix the overall winner, the best option if you can afford it, is to get more than one service. The nature of Netflix and Amazon Prime's service’s exclusivity deals means that you’re unlikely to get access to everything via one subscription, and Now TV offers things not present at all on the other sites. Depending on your particular interests, then, it’s the best way to make sure you’re not missing out on anything.
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