Thx.

Btw, yes, I would like to be compensated for this information if utilized.

S. J. Dowd

Don’t make me pay more so that someone else can’t view something. Make me pay as little as possible and still give me access. That’s the value of NFLX…

You can get any best selling book at Walmart, Target, Amazon, Barns & Noble, or any local bookstore. Nothing is gained by the publisher or the consumer by saying ok now we’re only going to distribute through 1 channel for a 30 day window.

If NFLX just keeps offering 10,000 hours of quality streaming content in a dozen different catagories for $9/month they will continue to grow their customer base at an exponential rate for years to come… the Dreamworks deal was foolishly overpriced… hell while the shares were over $250 they should have just bought Dreamworks outright in a stock transaction.

I don’t quite follow this….did Netflix pay Dreamworks in stock?

How does the yo-yo stock price affect Netflix’s underlying business operations?

Say tomorrow someone invented streaming hamburgers. And, say, the next day McDonald’s assured the market that it understood “changing times” and would corner the world of streaming hamburgers the way it had cornered the world of the non-streaming variety.

The market would bust a nut.

“Naturally,” says the market, “let’s throw money as this massive venture. McDonald’s understands and dominates the world of non-streaming fast food better than anyone else. In fact, it’s not just the non-streaming hamburgers itself but the non-streaming delivery of those burgers it gets. From top-down, here is one of the few companies that ‘gets it’ in a [reference Steve Jobs somewhere in there] changing world.

“Therefore, let’s follow it, lemming-over-fist, as it builds up its non-streaming side. And let’s forget that massive piles of debt are piling up like so many napkins when we eat the McRib. And let’s forget that, unlike non-streaming hamburgers, McDonald’s doesn’t actually own streaming hamburgers (yet, by the rules of accounting, those contracts are counted as an asset).

“We know this non-streaming hamburger business is happening. We know that only McDonald’s has the experience and know-how to make it happen. Let’s do this thing and build our confidence upon this House of Wrappers.”

And then, after years of an echo chamber of confidence dominating this discussion, the execs announce a plan that chases customers away, reminds the market of all that debt piling up and wakes people up to the fact that, really, no one needs McDonald’s for streaming hamburgers… yeah, the stock suffers a bit.

Given that Apple is priced lower than the average growth stock, the possibility of their growth leveling off or crashing has already been priced into their stock.

disclosure: I own Apple stock. I’ve been saying for the last 3 or 4 years I’m going to sell it soon, but their competition is so incompetent, I can’t come up with a good reason to do that.

Short of the century if you have the timing down? ;)

Um, Felix, could we agree that you will never use this phrase again? It’s been disproven in so many cases during the last, oh, millennium that it’s no longer useful, even as a rhetorical foil. (“But now we see that, quelle surprise (hat tip YS), stock bubbles do occur!”)

Of course “rational expectation” is always correct ex post facto — once we’ve figured out what the fundamentals actually were. It keeps us sane — and hopeful — and allows us to make the same mistake in the future, sans peur et sans reproche (hat tip CdB).

I dropped the DVD service when the price change went into effect–and it was only that late because they didn’t process the change the month I made it.

As noted elsewhere–including by you–the Streaming service is all right, but Hulu and Amazon Prime are all right, too. Not to mention that DVDs (and some Blu-Rays) are Priced to Sell at a level comparable to NYC Street Vendors ca. 2006.

Incenting people to drop the one thing that makes you unique–the DVD catalog with broad appeal (i.e., more kids’s and family shows than Felix’s alternative suggestions)–is rarely a good business plan.

As sophiewonderful notes, we’re not forced to use Netflix. Someone should have told Reed Hastings that a few months ago.

The spiraling stock price led to their downfall. To justify that kind of P/E, they needed to find some way to squeeze additional cash out of their customers while continuing to expand their customer base rapidly.

Hard to achieve that — you can typically manage price increases or volume increases, but not both simultaneously. Not of the magnitude necessary to justify the share valuation.