Streaming Inc Content Streaming Business Discussion Project
Streaming Inc. (SI) is a 25-year-old company in the content streaming business. It sells monthly subscriptions, which allow access to its library of original content shows and movies as well as licensed content. The company recently went public on the National Stock Exchange. Members can watch the shows and movies as many times as they want and for as long as they want. Revenues have been steadily growing due to a recent and pervasive pandemic.
Many governments have imposed “social isolation” requirements as a means to slow down the spread of the virus and so many people are making greater use of streaming services. There is growing interest in the industry in general by investors looking to invest. Increasingly, new entrants into the marketplace are threatening to take customers away.
Just after year-end, one of the large tech companies announced that it was launching a new division that will be in direct competition with SI’s core business. This is a concern for SI since the big tech company has a significant amount of ready cash that it will use to develop content and market its new product. According to the company’s financial statements “streaming content obligations include amounts related to the acquisition, licensing and production of streaming content including commitments under various contracts”. Obligations for the acquisition and licensing of content are incurred when the company enters into an agreement to obtain future titles. Certain agreements include obligations to license rights for unknown