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In: Economics

How is Netflix an oligopolistic market that abuse their power? Explain how they abuse their power...

How is Netflix an oligopolistic market that abuse their power? Explain how they abuse their power and describe the impact on consumers

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Expert Solution

Oligopoly consists of a few selected companies that have major impacts over an industry. Netflix is world's one of the leading internet entertainment service providers with a variety of languages. It was started in 1997, from that period it is striving to increase its customers list and also expanding its business. It has more than 100 distribution centers. But now customers are complaining about its service. According to the customers it is abusing its powers after gaining too much of popularity in its industry. It is annoying customers by providing bad quality contents, poor management of movies and television shows. Sometimes it is compelling customers to watch trailers again and again while trying to browse movies and television shows. It has raised its price and features are not upgraded. There is no proper filter of movies, i.e., no separate grown up profile and child profile. Horrible,violence, love and sex all types of movies are mixed up. Watching movie with family is completely impossible on Netflix. It is just abusing its power and can be defined as oligopolistic market.


The consumers are quite disappointed with Netflix due to so many reasons. First thing, it is not focusing on customers. It is delivering movies which customers do not want to watch, there are more than 60% foreign movies loaded on Netflix that nobody wants to watch because of language problem. Again adult movies and family movies all are mixed up that can't be enjoyable with whole family members. Finally, it has increased its price which is not acceptable by the consumers and due to these problems many people are closing their Netflix accounts.


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