Netflix makes no bones about the fact that it wants to be HBO. And it is closing in on the pay channel, at least in terms of revenue: Last year, Netflix’s streaming business generated $3.5 billion, while HBO made $4.9 billion from subscription fees.
But while it chases Time Warner’s pay channel, Netflix has already passed lots of other big cable operations. MoffetNathanson’s Michael Nathanson spelled it out in a research note this morning — Netflix has already climbed past AMC Networks, Starz, CBS’s Showtime and Scripps Networks. Next up, Discovery:
Remember that we’re talking about revenue here, not profits: HBO generated operating income of $1.8 billion last year, compared to Netflix’s $228 million.
On the flip side, remember that except for HBO, Showtime and Starz, the rest of the cable networks are dependent on the bundle — people pay for them, more or less, whether they want to or not. Netflix, meanwhile, only makes money when people order it themselves, and pay for it directly.
For a while, that looked like a vulnerability for Reed Hastings and company. Now, as the company passes the 44 million subscriber mark, it seems like a big advantage.
This article originally appeared on Recode.net.