Netflix made some news this week with big stock gains that followed release of its fourth-quarter earnings report. Part of the story is an increase in streaming video subscribers, so I thought it would be a good idea to consider some numbers and context.
The news is that Netflix now claims 27.1 million U.S. streaming subscribers. I guess that sounds good to investors, but what does it say about the place of Netflix in our media ecosystem?
One relevant comparison would be to the number of paid subscribers to Hulu Plus, a similarly-priced competing service that offers streaming television shows and movies. On the company blog last December, Hulu claimed "more than 3 million paying Hulu Plus subscribers." Amazon Prime membership also includes streaming video, but Amazon doesn't seem interested in releasing subscriber numbers.
Another apt comparison might be between Netflix customers and cable network penetration. The top cable networks (including TBS, ESPN, and CNN) each had just over 100 million subscribers in 2011, according to the cable industry.
Netflix content can't replace the experience of cable networks that include live news or sports, so maybe a better comparison would be with HBO subscribers. HBO and Netflix might both serve as a premium add-on to cable. It happens that HBO has around 30 million subscribers, just ahead of Netflix's 27.1 million.
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