by Glenn Busch
September 1, 2011
At first streaming movies over the internet was a novelty. Netflix (NFLX) took advantage of this and was able to strike a couple cheap content deals to stream movies digitally. The studios/content creators didn’t realize the direction movie delivery was taking and they soon found out that they gave away their content too cheaply. Not anymore.
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by Glenn Busch
November 24, 2010
Netflix (NFLX) trades at multiples that would suggest it offers a premium service with strong price protection but it is a commodity service business. Also, as it changes its business structure into a pure digital streaming business, whatever pricing power it has as the leading DVD-by-mail rental company will be lost. The online streaming of movie titles presents a lower barrier of entry than DVD-by-mail rentals and Netflix’s competition will increase.
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