It’s no secret that Netflix has been taking on the telecoms head on — rallying an entire chord-cutting connectivity class behind them. And now, in an effort to further their exceptionally high growth, they’re partnering with an actual telecom. The move is fierce and aggressive, but one the telecoms can’t really afford to deny. In fact, it could spur an entire wireless connectivity package deal for consumers.
As the traditional telecom television telecom behemoths report struggles in quarter three, Netflix revealed they exceeded sign-up expectations. While the streaming service raked in 5.3 million new memberships globally this quarter (more than a million over projections), AT&T reported a loss of 390,000 traditional video subscribers. Yikes.
Lapping the competition
Without much deep analysis, it’s clear that Netflix isn’t just outrunning the competition, they’re lapping them. So when it was revealed this month that Netflix would be partnering with telecom giant T Mobile, it raised a few eyebrows. The move, of course, is beneficial to both parties. Now, customers who sign up for the T-Mobile ONE family plan can get a Netflix bundle. Here in the Netherlands, there’s a similar deal that will offer customers the option to get six months of Netflix free with a Go Unlimited plan — which offers unlimited wireless connectivity. It’s a great deal for consumers that will drive contracts to both companies.
But when you look at the deal, it’s not one that T-Mobile can really afford to deny. In fact, it could usher in an era when combining your cell phone subscription — or even your tv subscription — automatically comes with a Netflix subscription. It’s not like Netflix necessarily needs the help, they’re finding ways to dominate the market either way. But, for telecoms with falling numbers — Netflix could be exactly what they need to not just sign customers, but keep them.
New deals to be made
We could also see the day of when streaming your Netflix on the go comes at a premium price or is bundled with a special unlimited data plan from the telecoms — imagine that. And this isn’t far-fetched. If Netflix continues with this monumental growth, we can only expect to see these connectivity package deals continue to be built around the platform — however cannibalistic it might be to the telecoms and the legacy tv channels they’ve built empires around.
So, what’s next? Well, if we’re really going to be seeing Netflix streaming for free or at a premium for specific telecom plans, we’re going to need network and technology that support it. A 4G wireless connection will be needed — at the very least — and the implementation of 5G in the coming years is going to propel deals like this right from the boardroom into the consumer’s hands.
We can imagine it’s one of Netflix’s biggest dreams to be in every consumer’s pocket on demand, anytime. And if they continue on this trajectory maximizing wireless connectivity’s technology advances, we don’t see why this won’t be a reality quite soon.