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Rupert Murdoch urges media firms to unite to fight Amazon and Netflix

30 October 2014

From The Guardian:

The media industry needs its own competitor to online streaming giants Amazon and Netflix, Rupert Murdoch told a technology conference on Wednesday.

“As an industry, we need a competitor – a serious competitor – to Netflix and Amazon,” Murdoch told the Wall Street Journal’s WSJ.D conference in Laguna Beach, California.

Link to the rest at The Guardian

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49 Comments to “Rupert Murdoch urges media firms to unite to fight Amazon and Netflix”

  1. Well, gee, Rupert. You’ve got loads of money and influence, why don’t you start up something?

    TL:DR version: wah wah wah.

  2. I think the issue is that he wants a competitor to Amazon and Netflix to defeat them but *not* to also disrupt his established businesses. Alas, that is never going to happen.

  3. So why did HULU end up such a mess? It’s owned by NBC Universal/Disney/Fox.

    • Yes, exactly! A viable competitor must provide consumers with what they want. Hulu was promising at first, but couldn’t deliver fully what people were after.

      • You know it’s funny, but while Hulu was hot, I had no interest in anything but the free stuff there.

        But now…

        I subscribed, and I stopped watching Amazon Prime Video altogether. (Amazon has never really given me what I want with video.)

        And as a high video/movie consumer, I’ve never been happy with Netflix because they don’t stream the esoteric stuff, and they don’t let you choose what you’re going to get when with the DVDs.

        So, honestly, I think it’s too early to tell what shape these markets are going to have. It’s still all shaking out. What I have found is that if I had more money, I would be subscribing to small direct providers (like Warner Home Video) than services like Netflix.

        In other words: direct video is another place where disintermediation is going to shake things up — and it’s going to shake up the companies that just finished shaking things up themselves.

        We aren’t going to see what it will really look like until the cable hegemony is actually broken. (Sometime around when you can subscribe to ESPN directly, or through multiple competing online companies like Hulu/Amazon/Netflix.)

        • you’ve tried indieflix, no?

          • They don’t have enough of what I want, but if I had more money, they would definitely be one of the “specialty” things I’d subscribe to.

            I’ve used Acorn TV as well — but I found that, after I’d watched for a month, I’d already seen everything that I wanted to see. I kept the subscription for a while to see if they would add more I wanted, but… most of the stuff they added didn’t interest me quite enough.

            Again, that’s partly budget. If I were spending as much as most people spend on cable, those are both channels I’d add for the price.

  4. Netflix and Amazon have been around for a while now, establishing their business model and slowly generating a “fan base”. If they wanted to compete with these guys, it needed to start a long, long time ago. I was a manager for Blockbuster back in the day when Netflix was just a tiny little name associated with movies that hardly anyone used, and I remember so many big shots of the company at the time saying they weren’t going to even stop to think about what Netflix was doing because it was going to be short-lived and was just a fad. That sure turned out well for them. When they finally realized the kind of company Netflix had become, they tried to compete but it was way way too late. Netflix had already been obtaining a customer base and working out the bugs, so by the time Blockbuster tried to jump on the bandwagon Netflix already had a solid business and Blockbuster was still trying to figure out how their traditional business model of having to go in store for rentals, wasn’t making customers as happy anymore.

    • I was an early adopter of Netflix and am still a subscriber.

      In the tech world, a first-mover that doesn’t do something dumb is hard, often impossible, to catch up with. All the wishful thinking by Big Publishing cheerleaders about publishers or somebody launching a bookselling service to compete with Amazon only shows how little that group knows about online technology.

      • And the post title explains one of the reasons why. We have multiple competitors in the old business model, who suddenly have to ‘unite’ to fight the new business model.

        Not gonna happen.

      • Same here. I started with Amazon in ’98 and with Netflix…well, I forget, but before Blockbuster stores bit the dust. For me, it’s about selection (much bigger online) and convenience (to my door). I remember going to BlockBuster and thinking, “Why am I even here, the selections sucks.” Whereas Netflix had the foreign films and obscure stuff I wanted. Just like Amazon let me find the less popular or niche titles I desired. And I got my stuff in a couple days.

        I’m fine with them investing in the next big thing–but it better have great selection, low prices, and come to me without me making much effort.

        • Another problem with Blockbuster’s business model was that it got a significant portion of its revenue by making customers unhappy (by charging them late fees).

          Customers who are generally bummed out when they leave your store don’t tend to be loyal customers. 🙂

          • Ah yes, “No more late fees” was a HUGE arrow in Netflix’s quiver.

            • HUGE. I tend to keep videos weeks, once months.

              • I actually lost a great deal of money that way with Netflix. Whwn you mislay a disc for a YEAR and are still paying subscription fees… (damn but I’m glad they introduced streaming for putzes like me…)

            • Yes, the total absence of late fees is the main reason I subscribed to Netflix and still subscribe today. I have too many balls in the air to reliably remember to return movies. Sometimes I keep a movie for months. Then when I want to rent something new, I realize I still have it, so I send it back to get the new one. No stress.

          • Yep, and it was shortly after this addition that I left my managerial post at Blockbuster. Then it was only a year after that their brick and mortar stores started dropping like flies. Blockbuster even tried “Blue Box” to compete with Red Box, but again, just too little too late. And the only way they could get the funds to attempt to be in the running again was to “tax” all of their existing customers to a ridiculous degree so they could attempt to attract new customers to all of the new goodies they were pushing. Too bad they waited until everyone had an established relationship with one of their competitors. I went from paying $37 a month for my Blockbuster online membership to $12 a month for Netflix. If Blockbuster hadn’t just waved their hand at how ridiculous Netflix was they may have been able to compete but such as it is by the time they tried they had to charge way way WAY too much and ended up not only dissuading new customers but made existing customers turn on their heals too.

      • I was an early adopter also, and I still kick myself for missing out on that particular investment.

      • As I mentioned above, I am not fond of Netflix. They started out promising, but they depend too much on cable being the bad guy to make the kind of real change in paradigm that Amazon did for books.

        When cable loses its bargaining power with small providers (which I expect to happen in the next couple of years, given that HBO has announced it’s cutting the line) THEN we’ll see if Netflix really has what it takes in the new paradigm.

        Amazon has the kind of vision that could really blow this industry wide too. (Imagine, for instance, that they offer the opportunity for local stations to live broadcast via Prime? Or even their own version of “public access”?)

  5. “As an industry, we need a time machine–a serious time machine–that will let us go back and squelch the development of the internet.”

  6. I would like to see a real competitor for Amazon. Another option to buy books and all sorts of stuff, for lower prices and free shipping. A digital retail store that gives authors the opportunity to publish for free and will then offer greater than 70% royalty.

    But something tells me that the established publishing/media empires are not willing to do the things that are needed to really compete.

    • I too would absolutely love this! In fact, I bought a Kobo with the hope that they’d become a genuine competitor to Amazon and their Kindle (not because I dislike Amazon or the Kindle, I have one of those too!). I think the more competition the better. B&N and Nook aren’t really going anywhere in my opinion.

    • What are the odds that a tradpub-backed ebookstore will carry indie titles?
      Without indies, any ebookstore is going nowhere.

  7. Rupert likes competition, as long as he’s the one calling the shots.

    It’s like wanting to play Monopoly but only if you get to be the banker.

    This reminds of the article that makes the point that software (technology) is eating the world. See also three posts below: Value in the media industry is moving to the edges, and publishers are in the middle.

  8. Those comments are going to get the DOJ’s Antitrust groups attention considering Newscorp owns one of the price fix six.

  9. Amazon, Netflix, Google, Apple, Microsoft, Facebook…
    Might as well band together to fight cellphones, automobiles, electricity, water wheels…

  10. Rupert! Missed ya old chap. This guy’s a world-class crank. This is his anti-Google stance redirected. The answer is the same one as there. If you’d have just paid some attention to your customers and not taken them for granted, you wouldn’t have that problem right now. He’s an old-school reactionary. That used to work back when the big boys could just steal the ideas of the new kids and club them into submission with a much deeper bankroll. But the kids grow up a last faster these days.

  11. Anybody remember when MySpace was bigger than Facebook? I do. Then Murdoch bought MySpace. That was just his biggest failure. That dude has ruined more internet companies than anyone else.

  12. With his recent track record, I can only chuckle. The guy is the establishment. He was smart like 1000 years ago but today he’s just part of the old boys club that is clinging to power and trying to keep the world from changing around them.

  13. Exactly what is he offering as a better idea than what Netflix and Amazon provide for all these other media companies to rally around?

  14. Um. Isn’t this a little hypocritical? Considering Murdoch owns half the media in the US as it is, and had more than a little something to do with destroying the old broadcast and/or newdpaper ownership rules? Way back when and IIRC.

  15. I encourage the publishers to go where Amazon and Netflix have already been. While they are doing that, Amazon and Netflix will be innovating farther down the road.

  16. If only other people could create something that would screw the customer to the proper benefit and deference to the most powerful corporations Murdoch could finally sleep peacefully at night.

  17. Notice that Murdoch said that “the media industry needs.” No indication that HE’LL do anything.

    He’s too smart for that, because he’s had his own problems with online ventures.

    His iPad newspaper, The Daily, closed in 2012. In October 2011 it had 80,000 paying customers.

    And according to Gigaom, he admits he “messed up” Myspace: https://gigaom.com/2014/10/29/rupert-murdoch-on-myspace-we-just-messed-it-up/

    I vaguely remember another failed online venture of his about 15 years ago.

    He knows it’s not easy to get online properties off the ground. He’s being mischievous, if anything, when he talks about “a serious competitor” to Amazon and Netflix.

  18. This from the same man that is partial owner of HULU, right? Why doesn’t he just work on making his competitor to Netflix and Amazon a better and more viable service?

    • Hulu you can’t quite pin on him…except for maybe not pumping enough money into it or refusing to sell it to Microsoft when they came calling.

      1- Hulu is run primarily by NBC universal.
      2- Fox is one of its bigger content sources: they have most everything on it.
      3- Hulu isn’t trying to be Netflix, but rather a complement to it. They carry a lot of full seasons of older stuff but their mission statement these days is “next day TV”. Which nobody else is doing. Their biggest problem is CBS won’t play ball.

      I have all three services right now and I watch a lot more Hulu than Netflix and rarely Prime. YMMV, of course, but Hulu works fine, depending on what you want from it. And what they do best is “retroactive DVR” of current season shows. Netflix doesn’t do that. Prime only does it for a handful of shows…

      There is room for all three.

  19. The lesson to take away from this, boys and girls, is to be the innovator, not the copycat.

    And if you want to be the copycat, be innovative about it, eh? There’s no real reason Kobo, which was mentioned above, couldn’t have given Amazon a run for its money in the ebook market. Or B & N, for that matter. They both had viable ereaders.

    I believe it was management stuck in the old ways of doing business that held them back. People unwilling or unable to imagine what the Internet has done for the world, and adapt to it.

    • Kobo doesn’t seem all that interested in competing anymore. Their public statements suggest they’ve pretty much given up on the US.

    • Kobo seems to have emphasized Trads over indies in the past year or so. It is easy to get seduced by coop money, I think, but in the longer run it means you have hitched your wagon to an aging horse.

  20. Murdoch hasn’t exactly set a sterling track record when it comes to encouraging competition, has he?

  21. Maybe Bezos made a disparaging comment about Rupert on his cellphone? Murdoch reads the transcript and turfs his original speech…

  22. He is such a plucky man of the people, fighting the big bad media corporations. Hey, wait!

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