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Old April 4 2013, 11:40 PM   #2243
Temis the Vorta
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Location: Tatoinne
Re: sf/f TV development news - 2013

Yeah Apple or Google could spoil the party pretty quickly...

What I don't like about NFLX, is that contrary to the bull thesis, there are no significant barriers to entry. In fact, I do not view the NFLX moat as wide at all. It's really a matter of other companies deciding to spend just a bit more money for content. Moreover, I'm very confident if not outright positive that either AAPL or GOOG or both will create content delivery services for video that will be "good enough" or even superior to what NFLX is currently doing. When that is evident, NFLX will be fighting for not just growth but its very survival. Back to that in a minute.

What I do like about NFLX is that again, they do have a big lead in how they package the service and how much content they provide. While this costs them a lot of money and future payment guarantees, it's also "The Thing" that the competition has thus far not been willing to match. Contrary to what many think, I find the company's moxy to pay the premium dollars for the content has given NFLX its decided edge.


With regard to AAPL, I'm nearly certain that the new TV will not only come with gesture/touch based controls as I first described well over a year ago (see my report on Apple TV) but more importantly, AAPL TV could likely come with a new video streaming and content delivery powered by my predicted "media content search" capability. And the day this happens, I personally would not want to be long NFLX stock and in fact, I plan on being short the name.

The bottom line, NFLX has a great service for a great price and what looks like a strong lead. But I don't view that lead (or moat) being nearly as large as many of the bulls currently believe. And we might only be a few months away from seeing a true platform competitor for NFLX.
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