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Is Binge Viewing Good or Bad for Netflix, Inc. (NFLX)?

Netflix, Inc. (NASDAQ:NFLX) subscribers had to put in a little work in order to avoid engaging in “binge viewing” of Arrested Development this weekend.

In an interesting wrinkle — at the end of every episode of the cult fave sitcom that began streaming its fourth season exclusively through Netflix, Inc. (NASDAQ:NFLX) on Sunday — the next episode would begin screening automatically unless subscribers backed out of it during a brief countdown.

This is binge viewing at its binge-iest.

Binge viewing makes sense here. Like most situational comedies, the episodes clock in at roughly less than 30 minutes. The three original shows that Netflix, Inc. (NASDAQ:NFLX) has screened before Arrested Development have episodes that are twice as long. However, one has to wonder if the art of binge viewing will help or hurt Netflix.

Netflix, Inc. (NASDAQ:NFLX)Critics will argue that it cheapens the value proposition. If Netflix, Inc. (NASDAQ:NFLX) is going to spend big money to invest in 15 episodes that some diehard fans streamed at viewing parties on Sunday, shouldn’t it milk more out of the process? Instead of stringing viewers along for months — as traditional broadcasters have done for decades — does Netflix risk a spike in churn if fans can cancel their subscriptions as soon as they’re done?

This is a big bet for Netflix, Inc. (NASDAQ:NFLX).

It remains to be seen how, Inc. (NASDAQ:AMZN) will go about things. Earlier this month, it made several pilots available. The leading online retailer will decide which shows to bankroll for complete seasons after gauging viewer interest and ratings.

However, television production studios, major broadcasters, and cable networks have to be worried. What if binge viewing becomes the new normal? What if consumers grow so fond of the practice that they no longer want to tie themselves to weekly cliffhangers that test the resolve of patient fans? What if folks stop watching new shows, preferring to catch up on an entire season on their terms? What if Netflix, Inc. (NASDAQ:NFLX) is letting the genie out of the bottle?

It’s clear that binge viewing is in the best interest of the consumer. There may be something lost at the water cooler as everyone’s on a different episode of a popular show, but we live in “on-demand” times, and it has to be disruptive that a cable company charging more than $100 a month on average is being outdone by a $7.99-a-month streaming service.

There are plenty of companies with a lot to lose if binge viewing continues to gain in popularity.

The article Is Binge Viewing Good or Bad for Netflix? originally appeared on

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

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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