Streaming services have become the primary source of entertainment for many American families.

Over a decade ago, the average household subscribed to just one streaming service. By 2025, that number has grown to over four, as a wave of options flooded the streaming space. Back then, Netflix (NFLX) cornered most of the market.

Now, media giant Disney (DIS), tech and e-commerce giant Amazon (AMZN), and Warner Bros. Discovery (WBD)—acquired by Paramount Skydance (PSKY)—is competing directly with Netflix, attempting to chip away at the latter’s dominance.

While Netflix’s rivals have attempted to close the massive gap, none have come close to challenging the streaming behemoth’s dominance.

According to estimates, as of 2026, Netflix has over 300 million subscribers, followed by Amazon Prime and Disney+ at roughly 200 million and over 130 million subscribers, respectively.

Netflix’s position as a market leader has never been clearer.

That said, this success didn’t happen overnight, and there’s a lot financial advisors can learn from how it got there, both experts who evaluate investment opportunities and as professionals who seek to build a practice that has long-term competitive advantages.

Leveraging Customer Data

Founded in 1997, Netflix’s original business model centered on renting out DVDs by mail for nearly a decade.

By 2007, the company launched its streaming service, allowing users to watch movies and TV shows online. That decision helped propel Netflix to $1 billion in annual revenue.

In 2011, the company had grown its revenue to over $3 billion, and by 2017, that figure had grown tenfold.

Photo from Unsplash

Anyone looking at Netflix’s rapid growth from the outside might attribute it to good timing. But it wasn’t luck that drove the company’s success. Netflix had been studying its customers’ preferences since it began renting DVDs in 1993.

That’s why, by the time the company launched its streaming service, it already had years of customer data to inform which content to offer.

Netflix also experimented with different business models over the years, adjusting everything from its delivery method to its subscription tiers.

The company even opened its own production studio in 2009, a move that proved critical once companies like Disney and NBC began pulling their intellectual property off the platform to launch competing services of their own.

Leveraging “Optionality”

Today, Netflix continues to use subscriber data not just to identify content that will interest its audience, but also to understand which genres and talent its viewers actually want.

Netflix’s continued success comes down to “optionality” guided primarily by the data it collects.

The competitive landscape can shift quickly, not just in streaming, but across nearly every industry. That’s why it’s important for companies to maintain options they can lean on to stay competitive and profitable over both the short and long term.

In Netflix’s case, the company has remained profitable despite intense competition largely because it continually adapts to meet its customers’ evolving needs.

By combining deep consumer data with strategic optionality, Netflix has maintained its dominant position in the streaming industry, even as demand and competition have shifted around it.

The key takeaway for advisors?

In today’s environment, understanding what your customers actually want, and having the flexibility to adapt as those wants change, are two of the clearest paths to long-term success. That principle applies just as much to evaluating a company for a client’s portfolio as it does to running a financial advisory practice.

Best regards,

Joel Litman & Rob Spivey
Chief Investment Officer &
Director of Research
at Valens Research

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