Example: the movie section at Hulu is almost comically under-stocked. That service’s bread and butter is in the television shows it streams from its network partners, and Hulu knows it. But it did something very smart back in February of 2011: it went into business with the Criterion Collection, launching a partnership to stream not only favorite titles from the cinephile favorite’s line of physical media, but numerous titles that were only available via the streaming service. That partnership now boasts over 800 titles; between that precious library and Netflix’s discarding of numerous hard-to-come-by catalog titles in last month’s “Streamageddon,” Hulu looks a lot more like the logical destination for film buffs (and if not Hulu, then other specialty services like Fandor, SnagFilms, and Warner Archive Instant).
When HBO rose to success in the 1980s, it had a Netflix-like monopoly on the movies-on-cable market (its only real competitor was the mostly West Coast-based Z Channel). But as it grew in popularity, it also suffered a bit of an identity crisis; smaller films and foreign fare went to its sister network Cinemax, while upstarts Showtime, The Movie Channel, and (later) Starz would attempt to siphon off subscribers with edgier branding and specialized programming. The channel really only maintained its dominance via the volume and quality of its original programming, and that seems to be the model that Netflix wants to adopt (the company has explicitly stated as much). But that simple equation (A few big movies + new shows = $$$) isn’t one that’s going to work in the fast-paced and ultra-competitive world of streaming video. If Netflix wants to continue to dominate, it’s going to have to figure out exactly who it is, or be willing to make the deals and spend the money to be everything to everyone.