Comcast Streampix, No Threat To Netflix

Comcast has announced the launch of a streaming media service called Xfinity Streampix that’s positioned to compete directly with Netflix. Streampix will be priced at just $5 per-month compared to Netflix’s $8 service – borrowing a page from the book of Microsoftian tactics, many Comcast customers will get Streampix for free when bundled with other services. While armchair analysts predict a Netflix demise, its stock has declined for the past two days on news that it has a new heavy-hitting competitor. But we’ll boldly predict Netflix isn’t going anywhere anytime soon and here’s why…

As on-demand streaming media grows from niche to mainstream it’s natural that those in control of the digital pipeline into your living-room want a piece of the action. As Comcast expands into every aspect of media, including content production with the purchase of NBC-Universal in 2011, it was only a matter of time before it started streaming. Comcast understandably wants to take back some of the ground it has lost to smaller, more innovative companies that use its bandwidth as an alternative to some of its Cable TV services. But as Comcast expands from ISP/Cable provider to content producer/TV studio and now creating a service that looks and smells like a true streaming digital media service; are the consumer’s interests being served - or is Comcast merely creating another safe haven for the same outmoded delivery practices preferred by the networks?

Comcast has publicly stated that it has no intention of competing directly with Netflix. "We didn't set out to go after Netflix's business," said Marcien Jenckes, senior VP and GM of video services at Comcast. "We set out to create the most compelling multichannel offering to compete with DirecTV or Verizon Fios."

Take a closer look at Comcast’s offering and you’ll see that despite its lower monthly fee, it’s less than a poor-man’s Netflix. Xfinity Streampix launches with a catalogue of older movies including Crouching Tiger, Hidden Dragon, The Big Lebowski and on-demand TV reruns like 30 Rock and The Office - a majority of Streampix offerings are already available on Netflix. Streampix is essentially Comcast’s on-demand video through the Internet.

By contrast Netflix has a long history and experience securing content for its users. Lately Netflix has been hard at work securing the rights to exclusives from the Weinstein Co. to deliver titles like The Artist, Iron Lady, W.E. and others. Part of Netflix exclusive deal brings the Weinstein Brothers content to Netflix before it appears on pay TV. In an effort to follow the innovations of HBO by creating original content of its own, Netflix is discussing a partnership deal with former HBO President Colin Callender to create original content for the streaming service. If a deal is reached with Callender, Netflix will look a lot like a pay-TV network.

Comcast on the other hand will bill its customers about 70-percent of the cost of Netflix for only about one-fifth the content. Backed by Comcast’s clout in the industry, Streampix launches with programming from Disney-ABC TV, Sony Pictures and of course its own NBC-Universal. But it offers nowhere near Netflix’s library of 20,000 titles including several exclusives you won’t get anywhere else. Netflix has proven itself a creative force in digital entertainment delivery – Comcast has a long way to go to catch up. We’ll see if the cable TV giant has the will to compete with Netflix by brokering deals on innovative new content.