+ Watch NFLX
on My Watchlist
Netflix delivers its comprehensive library of movies and TV shows online and through the mail in their ubiquitous red envelopes.
Tentatively thumbs up due to the recent sell-off.NFLX's main problem is bargaining power in negotiating licenses. This is a function of the content owners' fear that Netflix might drop them. There are two main factors in this:1. the size of Netflix's subscriber base2. the size of the largest content ownersAs 1 increases and 2 decreases due to the rise of independent content producers or (hopefully) antitrust action against media conglomerates, then Netflix will gain bargaining power and will be able to license content on less exorbitant terms. It will then become a profitable business.NFLX's moat consists of having BY FAR the best user interface, recommendation engine, and brand recognition as a paid video streaming provider.NFLX could be a great company. These are critically important for its success:1. expanding its subscriber base as fast as possible, even when there is no incremental profit from it, because it gets them better bargaining power so that they will be able to get better margins.2. Antitrust agitation against ALL mergers and acquisitions by large content owners. Lobby the European commission or any receptive venue to try to get antitrust action against the big media conglomerates.Google and Amazon have less bargaining power because their paid streaming user base and revenue is tiny compared to Netflix. The overall size of the company doesn't matter that much.
Years ago, having experienced the service, I saw it was a great time to invest. I moved overseas and live here in China now; the fascination with Hollywood here would make hollywood look boring, so much talent sitting on the shelf at NFLX... expand or expire!regards
I can't get an answer out of TMF regarding why they do not have in NFLX history all the recommendations they made to "add" that are underwater, deep in the red.Doesn't anyone remember the buys they had posted for NFLX before the big drop and then after the big drop, shortly after that they removed it from the "core" portfolio.You should email them and ask them what is going on there, do they think we have a short memory? lol
"NFLX's main problem is bargaining power in negotiating licenses. This is a function of the content owners' fear that Netflix might drop them."I don't quite get this, if NFLX never have their content to start with, they can't make a cent.If NFLX does have their content, they make money, and if they get dropped, they still made the money.Which one makes more sense? It is a revenue stream fif they pass on NFLX, who is going to be any better?Just as DIS has done, I think others will soon give up whatever ideas prevent them from wanting in on the action. DIS makes $300M on a good flick or two, but they have to do noting much at all for the $300M the NFLX is going to pay them. That is a bad deal? That is $300M DIS can pour into some other content creation. Make even more money.
My Netflix article on Seeking Alpha:http://seekingalpha.com/article/1057281-netflix-could-go-bankrupt-in-less-than-5-years
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