It's too cheap for Netflix to show a keen interest

Daikinghon

Netflix, which had a steep drop in the number of new subscribers, had a sharp fall in share prices, attracting the attention of Cuban, who founded the Multimedia Web Services website broadcast.com, that "valuations are too low for anyone to buy." ”

Cuban actively overweight

Library class, sports fans may be very familiar with the NBA team as the Dallas Mavericks boss, its flying personality is popular with fans.

"I'm buying a Netflix stock," Cuban said on Twitter recently. Because the market capitalisation is only half the price of Yahoo, 10 billion dollars cheaper than Twitter, valuations are far less than big media companies, and someone should buy them. ”

In an interview, he has just increased his holdings of 50,000 Netflix shares, but he is not sure how many shares he owns in total.

Perhaps China's domestic investors are a bit unfamiliar with Netflix, but its launch of a U.S. show is a familiar one--"the card house."

"The Card House" is a political theme of Netflix's first original homemade TV series, and Netflix has soared because of the popularity of the U.S. show, the world's paid subscribers to reach 50.65 million, the same period, the share price rose to record highs.

"The issue of the card House has had a halo effect on our entire company," he said. "Netflixceo Ride Hastings (reedhastings) and CFO David Wils (Davidwells) said in a letter to shareholders.

The first quarter of the card House debuted on the Netflix website on February 1, 2013, with Netflix's share price up 171.48% per cent from February 1, 2013 to October 15, 2014, according to wind statistics.

The main reason for the slump in Netflix's share price was the unexpected number of new users.

According to the latest report, Netflix added less than 1 million users in the US in the last quarter, compared with 2 million new users in other countries, both of which were worse than expected.

Hastings said the slowdown in subscriber growth was due to the recent price hikes by Netflix, which underestimated the impact of the price hike. The second quarter, the women's prison, was considered an important driving force for users to continue to pay for the use of Netflix.

"We underestimated the growth in the number of users over the past 3 quarters. This quarter, we overestimated the increase in the number of users. We will continue to report internal forecasts for the current quarter. This expectation is sometimes higher and sometimes lower compared with the actual result. "Hastings said.

Is it reliable?

The fact that an NBA team owner has a fancy for Netflix seems a little irrelevant, even absurd. Is the overweight of the library class too blind or purely due to self interest? Here it is necessary to introduce the experience of the point Library class.

In the 80 's, the sports-loving library class started to run a computer consulting firm called Micro-solutions, and the company's annual revenue reached $30 million in just 7 years. Later, Cuban also founded Broadcast.com, the site mainly broadcast sporting events, eventually Yahoo bid 4.7 billion dollars will broadcast.com acquisition.

From the experience, the experience across it and the internet has undoubtedly shown that Cuban's knowledge of the industry is much higher than others, and at present, Netflix in the United States pay video market share is already in the first place, the vast number of subscribers to its own subscription group is the source and guarantee of its profits.

In the third quarter, Netflix's revenues were $1.223 billion trillion, up 38% per cent year-on-year, net profit of 59 million dollars, up 84% in the year, and diluted earnings of 0.96 U.S. dollars over the same period of 0.52 dollars in the same month.

Among the most critical groups of users, other than expected, other data show that Netflix is still in good shape.

Total online playback business, its total number of users has reached 53.06 million, the same period last year, 40.28 million people, an increase of 12.78 million people, the last quarter of 50.05 million people, the chain growth of 3.02 million people, paid subscribers 50.65 million people, the same period last year 38.01 million people, the last quarter of 47.99 million people.

Netflix estimates that the number of new users in the US and elsewhere in the next quarter was 1.85 million and 2.15 million, respectively.

Competitive pressure or rise

It can be said that Netflix's success is due to its original play production, while the big data help Netflix to the customer's interest and demand firmly in hand. But whether it's an original play or a big data-making use, these are not the conditions for a high threshold today.

15th, HBO announces the launch of a separate streaming video service next year. However, HBO has yet to disclose the format and price of streaming video services. Investors say Netflix's dominance is now on the market, and that if HBO joins the competition, it could have a big impact on Netflix, which could end up in a single situation.

At the same time, Amazon is starting to force the field. Recently, Amazon has announced a partnership agreement with HBO, which will start adding some of its old dramas to its video streaming service this month. This is the first Time Warner's HBO has licensed its content to network video streaming services. In addition, the HBO service will also be landing at Amazon's FireTV platform by the end of this year.

Amazon's Primeinstantvideo service has surpassed Hulu and Apple in terms of video streaming traffic consumed by U.S. broadband service users, according to a research report by Qwilt, a market research firm. Amazon's traffic has grown by 94% in the past 12 months, according to the report, and Amazon's video streaming has grown nearly 300% on some U.S. operators ' networks.

While Amazon is not yet a strong competitor to Netflix, Netflix points out that its main competitor is Amazon and HBO, as the two companies invest heavily in content-rights deals and original programming. As a result, Netflix, which currently has a number of user groups, is at a high risk of outflow if it does not expand the new user community well.