• Netflix Evolves from Avowed Downloading Skeptic to Impressive Innovator

    Yesterday Netflix announced a very cool new feature called “Smart Downloads,” which automatically deletes an episode you’ve downloaded and finished watching on your mobile device, triggering the download of the subsequent episode. The process happens as soon as you’ve connected to WiFi and occurs invisibly in the background. Smart Downloads is available for Android devices now and for iOS devices later this year.

    Smart Downloads is a clever way of automating a manual process, so that users always have something downloaded and ready to watch (although having to manually download a TV episode clearly falls in the category of “first world problems”). Smart Downloads is a a savvy move by Netflix to increase subscribers’ engagement time, which in turn leads to higher satisfaction and better retention. But perhaps most fascinating about Smart Downloads is that it illustrates how fully and quickly Netflix has evolved from an avowed downloading skeptic to an impressive innovator.

    It was just less than 3 years ago, in September, 2015 when Netflix’s former chief product officer Neil Hunt explained the company’s complete resistance to downloading. In an interview with Gizmodo UK, Hunt said “I still don’t think it’s a very compelling proposition,” confusingly adding “I think it’s something that lots of people ask for. We’ll see if it’s something lots of people will use.”

    Hunt bizarrely cited “Paradox of Choice” issues that he believed subscribers would have in dealing with what her termed the “complexity” of downloading - having the correct storage, managing it, and recognizing it won’t be instant. At the time, I wrote that Netflix’s anti-downloading stance was both perplexing and frustrating.

    Hunt’s comments came just days after Amazon became the first major SVOD provider to enable downloading to mobile devices. But Hunt’s odd explanation seemed so tone deaf and out of touch with the realities and benefits of downloading that it evoked memories of Netflix’s infamous Qwikster fiasco of 2011 when the company tried separating its streaming and DVD services, only to quickly retreat.

    In December, 2016 Netflix reversed course on downloading, belatedly introducing the feature, though primarily for its originals. No doubt Netflix subscribers around the world celebrated.

    Going back to 2012, when TiVo first enabled downloading of recorded programs, I’ve been calling downloading a killer app. Six years later, many of us often still find ourselves in situations with spotty WiFi or none at all (airplanes, cars, Amtrak, etc.) and/or don’t subscribe to pricey unlimited mobile data plans (which don’t necessarily support video streaming anyway. Downloading perfectly addresses all of these situations and had become a mainstream feature across multiple services.

    Now, less than 2 years after enabling downloading, Netflix has clearly gotten religion about downloading’s value, and Smart Downloads raises the bar for all other providers to follow suit. As the streaming wars intensify, we’re all going to be hearing a lot more about “engagement time” because it is such a critical driver of subscriber lifetime value. Just earlier this week, I wrote about how AT&T is planning to revamp HBO’s whole production model, driven by Netflix envy and the need to have more “hours per day” of HBO viewing. Downloading isn't just for ad-free SVOD either; Hulu recently said it will enable ad-supported downloading later this year.

    As a Netflix subscriber, Smart Downloads is a welcome feature. It’s also a sign of how quickly Netflix is able to pivot its strategy. Its previous anti-downloading was both unfriendly to subscribers and bad for business. Fortunately Netflix has seen the light and is now on track.