Is the PBS model next for Netflix?

Netflix has done an incredible job over the last two years of establishing itself as a creative powerhouse akin to HBO in their glory days. However, original content like House of Cards and Orange is the New Black doesn’t come cheap and it is already having a negative impact on profit margins, even with 50 million paying subscribers globally.

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The marketplace for other content is also going to increase in cost  driven by competition from all fronts including Amazon, there is only so much watchable stuff in the marketplace. With more than $8 billion in short and long term content cost obligations on their books it might make sense to move to a PBS model where certain programming is underwritten by a brand sponsor in order to keep their per monthly subscription cost below $10. I don’t think they would ever try to sell traditional :30 interruptions during a program. The caveat for Netflix would be having to share how many people stream each program which they now closely guard as a negotiating tactic with content suppliers. I think there would be a huge market to advertise on their platform and the market will eventually make this a no brainer option for them to offset the coming tidal wave of content costs.

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