Why I am rooting for Netflix (no, really)

Over the past few years, Netflix has become one of this blog's go-to examples for bad business writing. This is partially because there has been a tremendous amount of coverage focused on the company and partially because so much of that coverage has been either logically or factually flawed. After cutting through all of the hype, I find it difficult to be optimistic about Netflix, but I would very much like to be.

Right now, there are three major unlimited streaming services (four if you choose to include Google's YouTube). In addition to Netflix, we have Amazon and Hulu . Amazon has what strikes me as the best business model; unfortunately they also already have a dangerous level of economic power and a history of abusing it (if we include YouTube, the same comments apply to Google). Hulu is a walking antitrust violation in an industry that is already plagued by media consolidation. With competition like this, it is difficult not to root for Netflix.

My suspicion is that CEO Reed Hastings is playing a short-term game, trying to keep all of the balls in the air until he can either find a buyer or make a sufficient killing on the stock. A number of the company's policies feed this impression: the big one is the decision not to build a content library; then there is the tremendously expensive marketing that often seems more focused on building the company's brand among journalists and investors than among  potential consumers; there is the apparent disinterest in controlling costs, something that a company without a deep-pocketed parent cannot manage for long; and there are the disturbingly opaque metrics and bookkeeping practices. These things, along with the general conditions of the market, make me fear that we will not have an independent Netflix for that many years to come.

I do hope I'm wrong though.