I find no fault with my Foolish colleague Anders Bylund's history lesson on Netflix (NASDAQ:NFLX). It is, however, a history lesson. As such, it runs the risk of claiming victory based on the most recent decisive battle with Blockbuster (NYSE:BBI) and Movie Gallery (NASDAQ:MOVI), rather than the still uncertain campaign just ahead.

For a company to survive and thrive into the future, it must focus on the next generation of threats. I pointed out last November that even with traditional movie-rental stores in decline, Netflix is still stuck between a rock and a hard place. On one side, video-on-demand services from the likes of Time Warner (NYSE:TWX) and Comcast (NYSE:CMCSA) threaten its rental model. Time Warner is an especially worrisome threat, since it owns a studio that produces a decent share of sought-after content. On the other side, Wal-Mart (NYSE:WMT) has placed continual downward pressure on the price of buying a video. That now means that nearly any movie you want to see, you can own for about the cost of one month of Netflix's most popular plan.

As fiber-optic Internet connections get added to people's homes, video download services and instant-rental business will likely add yet another level of competitive threat. Netflix has a great past, but its future is on shakier ground. As we teach at Motley Fool Inside Value, companies are valued based on their potential future earnings prospects. The past establishes a track record, but it says nothing about what will happen tomorrow. For Netflix to be worth what the market values it at today, it needs to have both a solid strategy and the technology in place to fight the next war, not the last one. Until I see definitive plans in that direction, my money is staying away.

Netflix and Time Warner are Motley Fool Stock Advisor selections, and Wal-Mart is a Motley Fool Inside Value pick. Take your favorite Foolish investing service for a free, 30-day trial.

There's more to this Duel! Check out the other three arguments, and then vote for a winner.

At the time of publication, Fool contributor and Inside Value team member Chuck Saletta had no ownership stake in any of the companies mentioned in this article. The Motley Fool has a disclosure policy.