The Resurgence of the "Netflix Effect": Studios License Old Shows to Competitors Again

Some of Netflix's competitors, including Warner Bros Discovery's HBO network, are reversing their strategy by licensing their old TV shows and movies to Netflix, boosting its programming offerings but potentially squeezing its profit margins. This shift comes as legacy media groups seek streaming profits and view licensing revenue as attractive. While analysts see this as a positive for Netflix, they also warn that the cost of licensing, along with Netflix's investments in gaming and other sectors, could put pressure on its profit margins in 2024. Despite the potential challenges, licensing deals have given old shows new life and increased engagement on both Netflix and Warner Discovery's Max streaming platform.