Former NBC Cable President Tom Rogers is dialing back his bullishness on Netflix, citing competition with free content on YouTube as a potential headwind. In a recent interview on CNBC’s “Fast Money,” Rogers, who was previously a self-proclaimed “raging bull” on Netflix, expressed concerns about the streaming giant’s subscriber growth and viewer engagement.
While Netflix still boasts more hit shows than all other streaming services combined, Rogers noted a decline in the amount of viewing per viewer. According to Nielsen data, Netflix saw the largest monthly viewership increase compared to its peers in June, but YouTube continues to dominate with 13% of total monthly TV viewership compared to Netflix’s 8%.
Despite delivering a positive quarterly report in July, Netflix’s stock has dipped about 6% since the earnings release and is now down nearly 11% from its record high in June. Rogers emphasized the importance of viewer engagement in driving price increases, programming budgets, and ultimately, the creation of more great content.
Looking ahead, Rogers believes that artificial intelligence will play a significant role in shaping the future of streaming services. While AI can enhance targeted advertising and reduce programming costs for Netflix, it also empowers independent content creators, giving platforms like YouTube a competitive advantage.
Rogers predicts that AI tools in the hands of amateur creators will blur the line between professional and amateur content, potentially boosting YouTube’s viewership even further. Despite the rise of YouTube’s parent company, Alphabet, which is up 2% year-to-date, Rogers still views Netflix as the most valuable media company in the world, but cautions that a slowdown in growth is something to monitor.
A Netflix spokesperson declined to comment on Rogers’ observations, referring to the company’s second-quarter earnings call for more information. As the streaming landscape continues to evolve, it remains to be seen how Netflix will navigate increasing competition and changing viewer preferences in the future.
