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Netflix's video subscription service lost 800,000 customers in the third quarter —the biggest exodus in its history— even as its earnings rose 65 percent.
No shock, and aside from their stock losing about 26% I'm sure they aren't too concerned when they are looking at a 65% rise in earnings. That's oil company territory!
I think this is kind of what they want as the DVD via the mail market declines and streaming continues to be the wave of the future."Never take a person's dignity: it is worth everything to them, and nothing to you." - Frank Barron -
I'm surprised that's all. I wonder if that is total cancellations or includes people like me who reduced service to streaming or by mail only to keep the cost down?You must try to generate happiness within yourself. If you aren't happy in one place, chances are you won't be happy anyplace. -Ernie BanksComment
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The biggest hit is expected on the DVD side, a service that Netflix has been de-emphasizing to save money on mailing costs as its spends more to license movies and TV shows for its Internet video library. The company expects its DVD subscribers to fall from 13.9 million as of Sept. 30 to as low as 10.3 million at the end of December."Never take a person's dignity: it is worth everything to them, and nothing to you." - Frank BarronComment
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there's still a lot of rural folks that don't have access to high speed internet, so Netflix will keep them as mail order customers. But hey, My Favorite Martian was just added, so I'm good with them.You must try to generate happiness within yourself. If you aren't happy in one place, chances are you won't be happy anyplace. -Ernie BanksComment
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Sounds like Netflix simply wants to get out of the mail order business and focus on streaming. Earnings will stink as they continue to lose subscribers on their cash cow business while simultaneously plowing cash into what they see as the future. I do think the streaming business is the wave of the future; they're just taking it on the chin now. Stock Analysts are having trouble modeling out earnings right now because of too many variables so they sell now and figure it out later. Sounds like the pain might not be over. Some analysts say it could fall to $50 or lower (I'm sure the buyers at $300 or not feeling so good right now). It does create a good investment opportunity once it hits rock bottom for someone who believes the streaming business is the future and is willing to hold on tight for a few years and let the investments now pay off down the road."The farther we go, the more the ultimate explanation recedes from us, and all we have left is faith."
~Vaclav HlavatyComment
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I think a lot of people with high speed internet incorrectly assume everyone has it or will have it shortly.
The reality is millions of people don't have it and will not get it in the near future.
It seems to me Netflix is going for the more affluent crowd - which is all well and good .... but that's only a percent of the public.
If they do phase out physical DVD's they will be shooting themselves in the footComment
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I got an e-mail from Netflix a few days ago. Seems they dumped Qwikster and are keeping the DVD service. Maybe they got the message.
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I think a lot of people with high speed internet incorrectly assume everyone has it or will have it shortly.
The reality is millions of people don't have it and will not get it in the near future.
It seems to me Netflix is going for the more affluent crowd - which is all well and good .... but that's only a percent of the public.
If they do phase out physical DVD's they will be shooting themselves in the footIt's not a doll it's an action figure.Comment
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I still think Netflix's ultimate goal and probably still is to sell off the mail order business to Blockbuster or another company and focus strictly on the streaming side. It's the more profitable of the two business models. I think management made a big mistake of taking the jump too soon. I have learned from years of investing that Wall Street doesn't like surprises and pummelled Netflix with the news. The backpeddaling and loss of subscribers made it worse."The farther we go, the more the ultimate explanation recedes from us, and all we have left is faith."
~Vaclav HlavatyComment
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Stockholders hands are effectively tied. They can vote for Board of Directors which has oversight of the CEO. Most publicly traded stock is owned indirectly through mutual funds so the mutual fund managers vote. Very difficult for an individual shareholder to do much other than sell their shares. The Board could fire the CEO but that rarely happens unless they really mess up. I'm sure the decision was made not only by the CEO, but top management, and the Board of Directors."The farther we go, the more the ultimate explanation recedes from us, and all we have left is faith."
~Vaclav HlavatyComment
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