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June 26, 2017 by Juan Vela

Why Does Netflix Owe its Success to Wi-Fi?

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I came across a recent study by Leichtman Research Group that highlights that more people now subscribe to Netflix than cable TV in the US. For anyone with a young adult daughter (or son) like myself, this is not surprising. Upon moving into her first apartment, my daughter decided cable TV was an unnecessary expense and decided to instead invest her money in a 50 Mbps Internet service, a good Wi-Fi router, and Amazon Fire TV Sticks. While the future of TV is definitely streaming services, I can’t help but think about why Netflix is so popular and what we can learn from them.

Admittedly, I have a Netflix subscription but rarely use it. However, my media savvy family members swear by the convenience and portability of the service. Within my home, I now count approximately 25 Wi-Fi enabled devices of which, at least 15 of them have a Netflix app. Mobile phones, laptops, tablets, TVs – even the dusty BlueRay player that rarely gets touched in our family room has a Netflix app. This offers a tremendous lesson for those of us in marketing that look for highly differentiated value in the products and services we advocate. Convenience, portability, simple to use interfaces, and personalized content are all key differentiators of the Netflix service and should continue to guide TV and streaming media providers. 

What’s my point? Netflix growth is directly related to the growth in broadband and, in particular, Wi-Fi. Sure, the differentiation I highlighted earlier are reasons that put Netflix above many of its competitors, but does anyone believe Netflix would be the subscription behemoth it is today if Ethernet cables were required to every app-enabled device?  My perspective is that Netflix owes its success to fast adoption and continuous improvement in Wi-Fi performance, coverage, and manageability. I can assure you my daughter agrees with me.