• by Wayne Friedman , Staff Writer, July 29, 2024

As if it weren't enough that Netflix continues to be the leader among premium streamers -- and in profitability -- one estimate projects that in three years time it will see more growth of nearly 80%.

The report from Pinnacle Investment -- which touted 78% growth by 2027 -- did not provide specific details. But consider that a good deal of Netflix’s increasing potential for growth in revenue and scale will have much to do with advertising. Advertising inventory has a very high profit margin. 

During a recent earnings phone call, Netflix executives said while advertising revenues are growing, the company will not be a major revenue producer for some time. 

Still, analysts believe its scale and high-quality, in-demand content will help the company to move up quickly -- even amid new streaming ad inventory that will flood the marketplace, specifically from the entry of Amazon Prime Video early this year.

Where does this leave every other wannabe competitor -- especially those legacy TV network media companies that have internal advertising operations set up from their longtime live, linear TV operations?

Right now, there is ongoing discussion about a merger of linear TV operations -- broadcast and cable TV networks and stations -- as well as with streaming platforms. 

Over the last few months, rumors abounded about Warner Bros. Discovery looking to merge to Paramount Global, especially around a Max and Paramount+ bundle and/or merger. Comcast seemingly considered the same for its Peacock and Paramount+ or Max combination.

All this comes with the cash-rich, digital-first companies -- Amazon, Google (YouTube) and Apple -- which still have the wherewithal to grab any and all keys parts of  linear TV and now streaming content to obtain major growth: Sports programming.

The most recent NBA announcement this last week included a significant 11-year contract with Amazon's Prime Video.

Figure this in -- that Netflix has thrived without high-level sports content so far, sans the NFL or NBA, and will still grow nearly 80% over the next three years?

All that would seem to make executives at streaming competitors pay a lot more attention.