Big Tech Takes Another Hit

the staff of the Ridgewood blog

 

Ridgewood NJ, it looks like the the age of Netflix and chill is over. Netflix is, of course, the N company in the super-tech quintet of FAANG titans which includes Facebook, Amazon, Apple, and Google.

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Netflix’s stock has gotten crushed this week. Perhaps competitor  Hulu will take over as the biggest platform.

Its share price collapsed by 35% in one day – one of the biggest single-day sell-off in the history of stocks. For now the rout doesn’t seem to be abating. Over the past year Netflix market cap has tumbled from $650 billion to now close to $200 billion.

The Netflix brass blames its demise on “fierce competition” for subscribers, nice try the just content stinks .

These companies with at one time $6 trillion in market cap have all been attacked as monopolies in Washington and by state attorney generals. The “break-up high tech” howls have been as loud and persistent as ever this year. They come from the far left – Bernie Sanders and Amy Klobuchar – and some conservative Republicans like Josh Hawley as well.

First we had Facebook’s plunge, apparently clamping down on free speech defeats the purpose of social media  and now the 60% collapse in Netflix’s stock, which is a painful reminder that there is no industry more hyper-competitive than the tech sector.

Joseph Schumpeter called this process “creative destruction.”  The Netflix sell off is a jolting reminder of the omnipresent and disruptive power of that concept. Our Wall Street friends used to call it, “get out before you get found out” .