Why Apple should buy Netflix

“Netflix’s rapid subscriber growth could make it a formidable competitor to iTunes, and an attractive acquisition candidate for Apple,” Sanjay Sanghoee writes for Fortune.

“Streaming video provider Netflix recently reported record subscriber growth of 2.3 million in the U.S. and 2.6 million internationally for the first quarter. The company now boasts 62 million subscribers worldwide,” Sanghoee writes. “Much of Netflix’s growth is being driven by its successful expansion overseas, as well as a rollout of new original programming series, such as Marvel’s Daredevil, Bloodline, and a renewal of existing hits like House of Cards and Orange is the New Black. The company also stands to benefit from consumers who don’t want to be tied to expensive cable and satellite packages in order to secure their entertainment.”

“Netflix will need healthy amounts of cash in order to finance its foreseeable growth,” Sanghoee writes. “For these reasons, the company is ripe for acquisition, and a company like Apple would be remiss if it didn’t seriously look into a deal. Apple has both the means and motivation to acquire Netflix, and while the movie and television business may not be Apple’s prime focus, it certainly can’t afford to stand on the sidelines while a player like Netflix takes over the market.”

Read more in the full article here.

MacDailyNews Take: Of course, this is why Apple bought Palm in order to “compete” in smartphones.

42 Comments

  1. Don’t know about buying Netflix but I wouldn’t mind Apple having its own streaming video rental service like Netflix.

    Cheap streaming video has a place in my entertainment system. Not really interested in a streaming music service unless it is VERY cheap.

          1. actually, silverhawk1 has a point. netflix’s contracts with content owners would likely be voided were the company to be sold, so their indigenous assets are quite low.

            1. Netflix produces their own content, Orange is the New Black being one and they are ramping up to do a lot more. I don’t think Apple wants to be responsible for “questionable” content. Everything they would directly product would be disturbingly G-rated, making Disney look like a porn studio. For that reason I’m not interested in Apple as a content maker in general.

          2. Oh really, towering genius? How do resellers add huge margins to a product the don’t own without losing customers to competition? Sounds like Enron to me.

            NFLX is for suckers who don’t understand the need for margins andj EPS growth.

          1. And after that are the contracts with content providers, original programming, and name recognition (Netflix is becoming synonymous with streaming video, much like “Kleenex” is to tissues).

            1. i have never heard anyone use “netflix” instead of “streaming” or as a generic term in any way, the way people use “kleenex” for “tissue.”

            2. I always hear “is it on Netflix” or “it’s on Netflix” not “you can stream it”

              Kleenex levels of name recognition? it’s getting there..

              My original point of my comment was that it seems every few months an “Apple should buy Netflix” article pops up.

  2. It would be nice if my 300 movies would stream like Netflix, meaning if internet is slow: start with crappy image to get it going and graduate up to my HD if possible. DUH. I’ve been fighting with my internet provider that only gives me 3-10MB download and HD requires 5-7MB to stream without interruption.

  3. Well, it might explain why Apple bought Beats… Because they were late to the streaming party and Spotify’s brand had been established. (Not sure Beats is either but that’s another story).

    Netflix is pretty damn good… And they have a pretty big library of streamable videos (they need more)… I really like their model, pay monthly and enjoy whatever you want…

    1. I wouldn’t mind paying $10/month for a Netflix or Apple addon service that only streamed recently released movies, but streamed ALL of them. Tired of waiting for movies to show up in iTunes.

      I can dream.

      1. Netflix won’t get ALL the new releases, because other companies (HBO in particular) have exclusive contracts with the content providers. Basically if you want all new release movies, you will need subscriptions to Netflix, HBO Now, and a couple of others due to exclusive content contracts.

  4. I’m not sure how many of Netflix’s content deals would stay in place if Apple bought the company. And, for those that it owns (House of Cards) I can’t see Apple creating adult content, fearing for its reputation as a non-controversial company.

  5. As soon as Apple buys Netflix it won’t be worth nearly as much as it is now. Netflix’s P/E is huge now and if Apple acquired it, I’d bet Apple’s P/E would only move up a tiny amount. Apple could probably put enough content deals together and challenge Netflix but I’m not sure if Apple would get back much. If Apple actually purchased Netflix I’m certain Wall Street would start envisioning all sorts of growth problems or something and they’d claim that Netflix and Apple is a bad mix. I have a feeling Apple would lose out. I think anything that Apple might buy will suddenly become a “problem” for Apple investors.

  6. FYI – Netflix has season 1 of “Halt and Catch Fire” from amc. The drama is about a company’s challenges bringing their first PC to market in 1983. There is a lot of arguing with humor thrown in every now and then. Many of you will probably find it somewhat familiar.

  7. Netfilix well good dramas but awfull movies some are absolute crap!!’ And thats like 70% of the movies on it. Its not worth buying Now TV and Sky have a better selection

    1. Wow! You sure know a lot about movies! You should totally go into movie making and show Netflix your great movies and they would totally have to buy them or something. No more of those ‘awfullll’ movies with not enough letter ‘L’ in the name.

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