Netflix - NFLX - Share Chat

If your three main competitors in your field are Apple, Disney and Amazon you might aswell just call it a day

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Subscribers since 2011:


(Source - Statista)

Netflix is at $8.99 a month, then $12.99 and $13.99.

Apple TV+ is $4.99 for a family.

Note that the Original content + certain shows may not be available on Apple TV+ and vice versa.

  • Shares of Netflix have fallen nearly 20% since its disappointing second quarter earnings.

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“We have tracked 48 titles in development at Disney+, 43 at Apple’s TV+ and 23 at HBO Max vs. Netflix with 71 English-language dramas, 62 non-English series, 32 comedies and 108 films in development,” said Mitchelson.

Netflix should never have worked. They were originally sending DVDs to people via the post. Even now they are transmitting a copious amount of data, and battling established players in the broadcasting space, as well as Goliath attention-economy players like YouTube, Facebook, Instagram etc. So I’m not sure whether I’d totally rule them out just yet.

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This is a big move. Must have cost a lot of money as Hulu is said to be paying $150 million USD a year currently to stream the show in America.

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“While we’ve been competing with many people in the last decade, it’s a whole new world starting in November
between Apple launching and Disney launching, and of course Amazon’s ramping up,” said Hastings, who also cited NBCUniversal’s coming Peacock service. “It’ll be tough competition. Direct-to-consumer [customers] will have a lot of choice.”

He said Netflix would continue to hew closely to its core strategy of offering content for binge viewing, the phenomenon it helped create. That means the service isn’t moving into live sports, as Amazon Prime Video has, and won’t experiment much with different release models, including for its expanding catalogue of original films. “They may have a qualifying run for theatrical, but it’s fairly small,” Hastings told the Royal Television Society conference in Cambridge, England.

In the U.K., Netflix has spent £400 million (about $500 million) over the past year and plans to increase the amount next year, Hastings said. In July, the company announced that it was establishing a production hub at Shepperton Studios, outside London. Its first production there is Charlize Theron’s “The Old Guard” for Netflix and Skydance.

Hastings warned that steadily rising production costs would climb even higher with the advent of the likes of Disney Plus and AppleTV Plus. Disney, too, has vacuumed up valuable production space in Britain, signing a long-term lease at historic Pinewood Studios. “Someday ‘The Crown’ will look like a bargain,” Hastings said.

He revealed that Netflix had tried to acquire “Fleabag” but was outbid. Amazon has the hit Phoebe Waller-Bridge show in the U.S. and the U.K.

Hastings also reiterated that his company was not interested in buying production or post-production companies: “We’re not in the acquisition business.” And he dismissed concerns that a handful of digital media giants, including Netflix, would monopolize the television market. “We win only about 5% of television viewing hours, so we’re nowhere near a concentration risk,” he said.

Source - Reed Hastings on the Streaming Wars: It'll Be a 'Whole New World'

A stock to watch - it’s been falling since 2Q earnings came out. Could be a long-term investment - a matter of when to go long depending on what you think the intrinsic value is.

It’s a tech company + a TV content production company = Valuation could be all over.

The fact that Apple and Disney are entering the field is great - that means Netflix’s business model works. Will it continue working in the next 10 years? More original content not available elsewhere + back catalogue could be the answer.

This is not an investment advice :tv:

Amazon—a vertical business with cheap access to capital and cash flow to spend from other businesses—is closing in on Netflix.

This is thanks to Amazon Prime and heavy investment in original and non-original content.

Some say it could be 50 million Prime Video users already vs 150 million Netflix subscribers:

Netflix (NFLX) was one of the first players in the online streaming space. Netflix launched its streaming platform back in 2007 and now has over 150 million subscribers worldwide.

Tech heavyweight Amazon (AMZN) entered the video streaming market a few years ago and has created a significant subscriber base since then. According to a Statista report, Amazon Prime Video had 26 million subscribers in the US at the end of 2017, and this number has now reached 40 million.

Source - https://articles2.marketrealist.com/2019/06/how-does-amazon-prime-compare-to-netflix/

Meanwhile, Prime in the US is Google-search-esque—more and more people are using it, it’s becoming indispensable:

Source - U.S. Amazon Prime subscribers 2019 | Statista

Just one remark: It is hard to directly compare Prime and netflix since prime customers mostly buy it for free shipping and not for streaming.
Quite misleading those stats. I use both services, but prime video as addition to netflix.

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I wonder when Disney/Apple are launching their streaming services outside of the US? I don’t think they have an offering in the UK yet

Disney+ has Comcast’s Sky to thank for.

Tom Harrington, a senior research analyst at Enders Analysis, confirms that “across five European markets Disney and Sky are bound by large content deals—which apparently run into 2020—worth in the vicinity of $1 billion/year (£800m) when including Sky’s deal with Fox.”

That includes the Disney channels carried by Sky, video-on-demand contracts to stream Disney films and Sky Cinema Disney, a co-branded traditional linear film channel with first subscription pay-TV film rights in the UK and Ireland to new titles distributed by Disney.

“Until the UK deal runs its course,” he says, “Disney+ won’t launch in the UK, with the same for the other Sky territories.” Switching to a direct-to-consumer model will also impact Disney’s licensing revenues in coming years and represents a major, long-term strategic shift for the company. (Disney did not respond to a request for comment for this story).

But it’ll still have to keep Sky on-side if it’s going to get the kind of reach it needs in the UK, Germany and Austria, Ireland, Spain, and Italy, where Sky is a dominant force in subscription TV. “As Netflix has shown,” says Harrington, “if you want subscriber growth you need to be in pay-TV boxes, smart TVs and preloaded on as many platforms as you can.” Last year Netflix and Sky partnered to create one subscription deal.

When that likely Q1 2020 UK launch date rolls around, Disney+ will be the combined home of all things Disney, Pixar, Marvel, Star Wars and National Geographic, as well as Fox content that’ll start with a new season of The Simpsons and gradually add the motion picture company’s back-catalogue of family-friendly film and TV hits like The Princess Bride and Malcolm in the Middle as existing contracts with other streaming and linear TV services expire.

Source - Disney Plus UK FAQ: Price & Compatible Devices | WIRED UK

Sky has SkyQ—Sky plc’s rather desperate attempt to stay relevant beyond cable TV. Sky plc was bought by Comcast (NASDAQ:CMCSA) in 2018. In the States, they offer Xfinity Stream TV. It looks like both Comcast (with Xfinity) and Sky still live in the traditional TV world trying carefully not to cannibalise their core business, while running broadband in parallel and “innovating” for the world where people’s main screen is in their pockets and bags.

And SkyQ, just like Amazon Fire TV, has Netflix.

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Very interesting, thanks for the breakdown as always, @engineer!

I know someone who will be following this story eagerly:

https://twitter.com/temiakinremi/status/1177245113505996802

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My money would be on CEO Reed Hastings though I do not hold any shares yet:

Speaking at a conference hosted by the Royal Television Society – in Cambridge, UK – Hastings spoke of “a whole new world starting in November”, citing the launches of Apple and Disney’s platforms as well as the prospect of NBC’s recently announced Peacock streaming service.

“It’ll be tough competition," he added, asserting that viewers after on demand TV content would “have a lot of choice” in the wake of the various services.

The increase in competition doesn’t seem to be ruffling Netflix’s feathers, though, as Hastings clarified that Netflix would continue its strategy of binge-watching series, amid increasing levels of investment in original content. Hastings explicitly said that Netflix would not be acquiring production companies itself, though: "We’re not in the acquisition business.”

However, we’ve also heard word of Netflix internally being a bit more careful with its purse-strings, with more emphasis on bringing in viewer numbers than critically-acclaimed content – something that could help profits in the short term but harm its reputation in the long run.

Netflix’s growth from a DVD-rental business to a behemoth in online TV streaming has come from a willingness to adapt its business model; we may well be entering a more conservative time for the business, as the company seeks to maintain its current operations rather than do anything drastically different with it.

Netflix has a few large competitors with deep pockets:

  • Apple
  • Amazon
  • Disney
  • YouTube

In addition, there is a sixth horse :horse: in the streaming games :tv: called ATT which owns Warner and HBO
 and DirecTV :satellite:. It’s listed on NYSE as T.

There’s an interesting read on ATT/Warner/HBO here: Bloomberg - Are you a robot?

TL;DR:

  • ATT is a telecoms company.
  • There’s loads of debt—AT&T bought Time Warner (HBO,etc) for $80 billion in 2018.
  • Departing executives from HBO and media.
  • Talks of adding ads to its streaming services?
  • It owns “Satellite TV” business called DirecTV, which is losing customers because of chord-cutting.
  • Distressed debt/activist investor Elliott Management took a huge stake in it—it is asking to sell underperforming assets (Satellite TV).

Check out its share price over 5 years:

Netflix is trading at around 7x sales (Price/Sales) but over 60x EBITDA (EV/EBITDA), according to Yahoo! Finance calculations. I haven’t verified them but it looks about right. The latter metric looks very “rich”—though it’s more of a reliable metric for profitable companies—but what do I know :woman_shrugging:.

The company is reporting Q3 2019 earnings on 16 October.

There’s some stuff IG put together ahead of the reporting here: https://www.ig.com/uk/news-and-trade-ideas/netflix-share-price--q3-earnings-preview-191009

Goldman Sachs expects the company to continue “performing”, with a new higher “price target”. This chart it posted is very interesting:

UBS on the other hand is bearish: https://www.cnbc.com/2019/10/10/analyst-calls-of-the-day-apple-cisco-kroger-more.html

:poop:

Source - https://www.cnbc.com/2019/10/10/netflix-nflx-will-weather-streaming-threats-goldman.html

Note, they’re always talking about “beating” or “not beating” “analysts’ expectations”.

Netflix going full circle and buying up old cinemas to show their content. They are also in talks to buy the Egyptian theater in Hollywood where they showed the Irishman :ireland:. Out tomorrow on Netflix worldwide

Clever move by them totally cutting out the Hollywood crowd and being in charge of every facet. Fair play to them. The owner of blockbuster really should’ve have bought them when he was offered them back in the day!

https://www.google.ie/amp/s/amp.toofab.com/2019/09/18/blockbuster-exec-laughed-at-netflix-when-they-offered-to-sell-for-50million-in-2000/

https://www.google.com/amp/s/www.techradar.com/uk/amp/news/netflix-looks-set-to-dominate-2020-golden-globes-with-34-nominations

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God I’m such an old man trapped in a young man’s body. The caliber of film(s) has gone to the dogs. What happened to the great 90’s thrillers. Seriously gone downhill in my opinion

If you look at the actual acting performance, movies from before 1990 are barely watchable and today’s actors are prime standard. The current industry however is not super creative when it comes to screenplay/script, but still very solid imo.

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Don’t agree on the acting perhaps we like different movies from the 90’s. I’m talking about the jackal, along came a spider, the fugitive, double jeopardy, usual suspects, seven, enemy of the state, the pelican brief, conspiracy theory, Air Force one, Lincoln lawyer

I agree with the creativity but not the acting point. It’s the same with the talent of pop singers in my opinion. It’s degraded in my lifetime

Also I said 90’s thrillers not before. 90’s is the golden age in my opinion

Wow. Just
 wow.

I mean, according to my Letterboxd stats, my favourite decades are the '40s, '70s and '50s. Which I guess means that I strongly disagree with what you’ve just said there.

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