What if Netflix, Inc. (NFLX) Is Wrong?

However, Netflix isn’t simply birthing the TiVo-zation of streaming with its quick release strategy. The company is denying itself a captive audience that it can string along for 13 weeks — or three months as paying subscribers — just in time to hand the members over to its next original show.

Hastings is right. It’s silly that we hang to a prime-time slot week after week, but there’s also something to be said about the momentum that builds when everyone at the office is bookmarked at the same point of a story arc. Cliffhangers exist because they’re effective.

How many folks taking advantage of free trials to consume the entire season before cancelling will it take to make Netflix reverse on this decision?

There isn’t an answer to that question, because Hastings is pretty sure that he’s right. And, outside of Qwikster, his track record of staying a step ahead of what consumers want is pretty remarkable.

DVDs by mail were slow to catch on. When Netflix began streaming in 2007, it was also ahead of its time. Splitting up its pricing between DVDs and streaming was also a move that was blasted at the time, but Hastings was merely cutting off the dead weight that DVD rentals were becoming.

It was easy to argue that Netflix was turning its back on optical discs too soon, but how’s that been panning out for the fading players these days? DISH Network Corp. (NASDAQ:DISH) is closing another 300 Blockbuster stores, and when Redbox parent Coinstar, Inc. (NASDAQ:CSTR) reports its holiday quarter results next week, analysts are bracing for a 27% decline in profitability.

Yes, it seems as if Netflix should be milking its $100 million investment better. Cracking open the cage to release all of the birds at once doesn’t make sense. However, isn’t this the first step in viewer realization of Hastings’ “managed dissatisfaction” theory?

Once they experience television this way, will they be able to view traditional broadcasts that are dispensed in weekly teaspoons the same way?

Hastings is at the helm of a new revolution, and it’s about to hit consumers like a house of cards.

The article What if Netflix Is Wrong? originally appeared on Fool.com and is written by Rick Aristotle Munarriz.

Longtime Fool contributor Rick Aristotle Munarriz owns shares of Netflix. The Motley Fool recommends Facebook and Netflix. The Motley Fool owns shares of Facebook and Netflix.

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