Well here’s a hot little rumor. Netflix stock has surged today on news that it may be acquired by Amazon.
The stock is currently up over 7% in trading today, at an 11-week high. Sources seem pretty thin, based seemingly on stock analysis from places like WhatsTrading.com. And neither company is commenting. But the idea is a hot one.
Both Amazon and Netflix are in the midst of a full-on push to get digital video content into the living room. Amazon via its On Demand service, and Netflix through its streaming service. The two are battling the likes of Apple (with the Apple TV) and to some extent Microsoft (though Netflix also works on the Xbox 360 — and Netflix CEO Reed Hastings is actually on Microsoft’s board).
But combined, the two would offer a very formidable combination. The reason is that while Netflix mostly offers older titles through its streaming service, Amazon offers all the new movies. Netflix of course sends out new movies via DVD by mail, but that service will one day go away in favor of streaming or downloading.
Again, who knows if this is in anyway true, but the stock fluctuations don’t lie, something is up with Netflix right now. From Bloomberg:
Trading of call options, which give the right to buy the shares, surged to 11,477 contracts, more than triple the four- week average and five times the volume for puts, which give the right to sell.
[thanks Andrew]
Netflix also streams a lot of current TV shows, and while the Network sites do this as well (and for free), Netflix will keep up an entire season for longer and allows you to watch it without commercials.
Netflix Instant Play and Hulu are the two reasons I don’t have cable any more.
I’m also agree that the great thing about it is that no commercials are involved, I think would be nice a fusion between these 2 companies.
John
http://www.encu...ntry/JobUsa.htm
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Online USA Jobs
This is a very smart marketing move by Amazon. I think this aquisition will prove very beneficial to them. For those who are looking for a cheaper alternative to Netflix – http://bit.ly/OlSZm
Buzz off, scam troll.
Cheaper? You’re charging people just to look. Netflix is free for the first two weeks.
So what if its free for first two weeks? StreamOnlineMovies is lot cheaper than Netflix because for $34.95 you can get access to all the videos and movies for one year. Netflix is minimum $15 a month. Now you can do the math and compare.
netflix isn’t a minimum of 15 a month, it’s minimum is eight dollars with taxes included. it’s awesome because you can almost rent every movie imaginable on blue ray or dvd, and there are newer movies on instant play, like pineapple express. Netflix is the sh**!
I looked at your site and it is an obvious cash trap with no regard for customer satisfaction. With Netflix I can stream to my TiVo HD DVR as well as egt DVDs regularly in the mail. Netflix is worth MORE than you troll cash trap site.
David, if your site is so great why is it that every link on your homepage just directs you to a page that prompts you to subscribe.
Who on earth would part with cash prior to knowing what they are getting for their money?
Fools is the simple answer.
Beware people…
http://www.comp...es-c189095.html
The link above sounds like a scam to me
yeah surely
You have to be joking… my 92 year-old grandmother could recognize that site as a scam.
I use and love both Netflix and Amazon. However, I’m not convinced that allowing them to come together would be in the best interests of consumers.
Super…I think it would be a great combo
yeah really…its goin to b grt
I would sign up for it if Amazon owned it.
I would too
Why????
Seriously why would having Amazon on the return label make you join? It would most likely still be run in LG and not Seattle.
Please explain… the marketing guy in me wants to know. (No sarcasm intended)
maybe because they already have an amazon account? lol
Is RedBox bothering Netflix that much?
However, both Amazon and Netflix are very data driven, and good at those datamining algorithms. There could be synergy in the technology.
Agreed, with the winner of the Netflix challenge, Amazon could also have killer recommendations across its entire network.
While it’s true that synergies exist between the recommendation technologies, the Netflix Prize algorithms would be less help to Amazon then you might think. All the leading Netflix Prize algorithms are variants of singluar value decomposition, which works with rating data (e.g. 1-5 stars). The vast majority of Amazon’s data for recommendations is boolean, not a rating value (ie. users have bought an item or not, or have visited a product page or not). This boolean
data needs a different algorithm then that used in the NF Prize. Yes, Amazon also has ratings for products, but a only a tiny percentage of shoppers use it (unlike Netflix).
Note also that Netflix has put poison pills in place (Hastings has always wanted to stay independent). Couple this with the fact that the stock is high right now, and I’m betting that this rumor will peter out, like it sis 2 years ago.
Synergy is one thing, but what I want to know is whether this deal will cause any paradigms to change.
Consider a combined Netflix + iMDB data set. That’s a LOT of movie data.
Interestingly, Amazon already links to a British netflix-a-like, LoveFilm, from its UK store: http://amazon.c...SIN/B0014XVTIY/
Heh, great title. I’m very curious to find out if this is true.
MG never fails to amaze us with his headlines
Yup, even the ones where he falsely accuses a company CEO of negligence in the title and then states he is “just joking” in the text of the article.
Great writing for sure….
The title makes no sense, at all.
yeah…it is true dear
Probably a good idea, but I’d prefer Amazon buy and save Tivo.
I hear you Tivo brother. Would love Amazon to buy and consolidate both Netflix and Tivo….but Netflix alone probably makes more business sense for Amazon.
This might be an uneducated question (I don’t use either of these on demand/streaming services) – but how would they compete with the cable company?
What stops Comcast or Time Warner from owning this space?
Overall suckingness.
Very insightful. Thanks.
He was being sarcastic, but aslo making a real point. Hehe. In reality, nothing at all is keeping the cable providers from competing capably in this space, they just aren’t doing it yet today. They don’t have the all you can eat pricing model and their selection is very, very limited.
That’s not sarcasm, that’s stupidity.
That’s actually a huge reason they wouldn’t dominate in a competitive arena like this. They suck horribly, at everything. My Time Warner cable internet has been non-functional 75% of the time over the last month, and their technician won’t be here until next week. The only reason I still have them (and lots of other people I know), is that they’re a monopoly in this area.
Exactly. I only have the most basic cable now, and I only have that because it’s actually cheaper to have it since I need Internet from them. But I rarely, if ever, watch it anymore. It’s all Apple TV/Xbox/Netflix/DVDs all the time.
“they’re a monopoly”
Yea…that was kind of my point. Monopoly companies can suck and still dominate.
The cable companies (and satellite companies) have a digital box in a huge percentage of homes in the U.S. – new and old movies are only as far away as the remote control…and I am sure they could increase availability rather easily.
MG – while I think you are a great writer and an awesome addition to TechCrunch, Im convinced you would never brush your teeth again if Apple came out with a new mouthwash.
Actually the big issue I see is that Netflix is completely dependent on the cable operators and telco’s to deliver streaming service, and since both of these entities are interested in the market netflix is going after, its likely they will work very hard to undercut them. Its very possible that they could do this in an anticompetitive means like bandwidth caps, and netflix would loose market traction.
yeah…u r right
It directly competes with their main revenue source. Which would they rather have, a $120/month cable bill from each subscriber, or the $9.99/month Netflix gets for unlimited streaming?
Well, the cable company already does compete somewhat with netflix; atleast comcast does. Through their on demand service you can watch streaming movies, tv shows, etc. as well as directly on their website which competes more with hulu than anything else.
However, their selection is pretty subpar and I’d imagine much of that is the fault of the studios wanting insane licensing fees, or else just a general lack of all the content sitting on the servers itself.
The networks and providers dont WANT you solely streaming content directly to your tv though. They want you to purchase bundled services and be forced to sit through endless commercials that are poorly targeted to certain demographics.
Thats probably the most reasonable excuse anyone could give as to why they dont play harder in this area
Would be pretty interesting considering Amazon.co.uk had it’s own DVD rental business and sold it about a year ago to the UK’s equivalent of Netflix – Lovefilm.com…
t
This rumor has come around several times before. Usually it just means it’s a good time to go short NFLX because it has yet to be true.
It certainly seems like there would be synergies. Is acquisition of large companies really AMZN’s growth strategy though?
bt dis time it seems to b true dear
I love how Netflix’ actual core business is completely disregarded. Unless broadband prices dip below 5$ / month, it’s going to be much cheaper to watch dvds than stream content for the ~37% of Americans who don’t have home broadband.
That said, I think Amazon and Netflix are a great match.
Where are you getting that “$5″ figure? How does it account for the people who pay $50-150/mo for cable?
That’s just it, Netflix or Amazon streaming requires a broadband account, which is going to cost at least 30-40$ / month in the US. DVDs have no such requirement.
5$ is the minimum Netflix subscription plan.
yeah u r right
i like the title more then the article content.
if i was gay or you were a woman, i’d love you for that insight.
That would be a nice little jab Against Apple. There is rumors that apple will integrate books into iTunes for their upcoming tablet device. This would obviously effect Amazon with the Kindle.
Interesting to see how this will play out.
I think it would be a smart play by Amazon and position them as an even more dangerous retailing monstrosity
I’d bet this is true, shame I don’t have a clue how to invest in a company
Amazon is the largest shareholder in LoveFilm, the biggest Netflix equivalent for the UK, Ireland, Germany, Denmark, Sweden, and Norway (or so says Wikipedia), so they’re already involved in this business.
It would seem Amazon would be a huge force to be reckoned with worldwide in the rental business.
Perhaps that would mean us Europeans could get a similar deal to the Netflix Xbox 360 service?
yeah..ofcourse its true dear
Does anyone count the Apple TV still as competition? I’m asking out of curiosity. I haven’t heard anything about that particular product for a number of years now.
If this is true, Blockbuster shareholders will soon be wiping their a$$ with their shares because that’s about all they’ll be worth.
heh
Talk about a corporate match made in heaven. If this was not on the table before, I would bet it is now.
Would this be a good fit? I wonder. Maybe it will. Books and movies are both mindfood. Digital books, streaming video.
You know, I was just going to post a comment about how there had not yet been a substance-free comment like yours, which typically pollute the comment threads of TechCrunch posts:
“Amazon and Netflix are companies. It will be interesting to see what happens.”
…and then I looked at the comment immediately above the comment box, which is yours.
A group of investment bankers line a dark oak conference table interspersed with the top brass from Amazon.
A crisply enunciated pinstriped banker drolls to the CFO. “You see, Thomas, what truly drives the logic– the brilliant reason–behind this acquisition is more than market share, more than synergies, more even than the praise you’ll earn from our legion analysts. Thomas, what separates this ingenius combination from the merely adequate is the realization that you both produce the same thing. You produce,” pauses the banker for dramatic timing, “mindfood!”
“That,” he continues, “and according to our extensive analysis you’ll find in our pitchbook, we’ve discovered that indeed it is incontrovertible fact that both of your esteemed organizations happen to be companies. How rare! Imagine the synergies, Thomas!”
The question is why does Amazon need NFLX? Or more why would Amazon pay for NetFlix legacy business? They could set up a competing streaming service themselves. NFLX doesn’t really offer them an advantage in technology nor do they offer any exclusive access to content. Amazon could negotiate with the movie studio themselves.
probably for the brand. A better brand can beat good technology
sounds like an awesome combo.
Netflix + Amazon = nuclear bomb to the rest of the movie/dvd/streaming world.
Could be a win-win situation for affiliates! Amazon movie on demand doesn’t had too much success, but with Netflix they could become huge!
yeah really…..
I had to cancel my Netflix subscription because Netflix was lagging when they sent out movies. They weren’t even brand new movies but they were at least a month or 2 old. I ended up going to Blockbuster to rent it. I like how you can trade movies under Blockbuster’s system.
Spread Eagle, Try this instead – http://bit.ly/OlSZm You won’t regret it. Its a lot cheaper and better than Netflix and Blockbuster.
Has anybody heard any details on why Netflix was down Sunday night for those of use using a computer to stream to our TV? With the recent coverage of rackspace and authorize.net outages there would be more buzz…
We have a service called BigFlix here in India. Just like NetFlix, but these guys even deliver the movies to you in person.
See what cheap labor can afford you?
you should definitely consider the ceo’s history. he’s no stranger towards selling companies once he feels they’ve reached their ceiling.
How about this title.
Amazon one-click away from Netflix.
Netflix already can stream Amazon VOD on its Roku set-top box so there is good synergy to compete with Apple TV. Wonder if they will let you stream purchased music.
Buying Netflix would give Amazon a business presence in most states, and as a result Amazon would then have to charge sales tax on most everything they sell.
Given Amazon’s current reluctance to charge sales tax (at least an unsimplified version), I doubt a purchase is imminent. Stronger ties might make some sense, however.
awesome combo.
Netflix are spammers. I got the same spam messages described by Skip Montanaro in the linked page, and since that happened (back in 2004) I have resolved never to do business with them since.
This would be cool. Netflix is a very “Amazon” type company. Also, I think it would be good for Netflix to be connected to one of the largest DVD distributers.
It could prove very useful for them.
LOL @ Amazon renting Netflix and never returning it. They’ll still be ok if they did that…:-P
Wow, you go there Amazon!
RT
http://www.anonymize.us.tc
I use Netflix and have a Roku as well. I probably get their mail DVDs much more for the newer movies, but anything I can stream over the Roku (The Office, IT Crowd, 30 Rock, etc…) I do since it’s more convenient. That being said, I have no desire to get rid of my ability to get DVDs through the mail since if the Internet goes down, you kind of can’t use the streaming service.
its not gud
I can see NetFlix subscriptions going up also.
I think that is very interesting, except I am a little worried about the cost skyrocketing now that Amazon may be in the drivers seat. Hope not, at least keep it reasonable like Netflix is now! Netflix, Hulu and Vista Media Center are the reason I just cancelled my cable/satellite TV service. Especially now that the digital ota is here. Watching Netflix through VMC is an excellent experience, coupled with Amazon’s newly released movies would make it even better, in my opinion. Everything streaming!
this would be awesome i would really like a company like amazon supporting my stream to tv dreams
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