Latest Netflix Earnings Report Mixed 303
nmpost writes with one interpretation of Netflix's Q2 results (PDF). From the article: "The beginning of the end may be at hand for Netflix. On Tuesday, the movie rental company posted its second quarter results, and they were not promising. While the company returned to profitability following a first quarter loss, Netflix had a 91% drop in net income. The company's troubles began when it attempted to split its DVD-by-mail and streaming services, effectively doubling the price it was charging customers. External forces are now beginning to weigh on the company, and its doom appears to be within sight. The biggest challenges facing Netflix over the coming months are going to be competition and licensing fees. Three huge companies are competing against Netflix in the streaming arena, which has already surpassed its DVD-by-mail business. Amazon, Apple, and Google all offer streaming content as well. As movie and television studios began to demand higher licensing fees, Netflix will not be able to pay, while these tech giants will. Netflix will eventually be priced out of the market."
Engadget, on the other hand, shines some positive light on the report: "The results are in from its Q2 2012 earnings report, and it's claiming 27.56 million streaming subscribers worldwide, up from 26 million last quarter. In the US alone that includes 23.94 million customers, after it reported 23.4 million in Q1, while DVD customers dropped by 850k to 9.24 million." So it appears that Netflix is either gaining new streaming customers, or converting those expensive DVD customers into more lucrative streaming-only customers.
I cancelled my Netflix subscription a while ago (Score:1, Informative)
Why pay for streaming with Netflix, which doesn't work on Linux, when I can use Amazon and the other services which work everywhere.
Fuck Reed Hastings and his company.
Re:I cancelled my Netflix subscription a while ago (Score:4, Informative)
As planned (Score:4, Informative)
The drop in net income for Netflix is according to plan. The plan is to rapidly expand into new markets, investing current income in growth, rather than taking it as profit. Subscriber numbers and hours of content streamed both show the plan is proceeding nicely. The size of the subscription base gives them the income to buy the content to keep subscribers happy. In my house, we watch about 3 movies a week streamed from Netflix, and about 2 movies a month individually rented from Amazon. So they're each getting 8 bucks from us. But Amazon Prime isn't worth it - the selection is far slimmer than Netflix's, and with our purchases of other stuff from them over $25, the shipping's free anyway.
Anyway, Netflix wasn't looking for immediate profit this last quarter. They were looking for income to reinvest. They got it. They grew. Since when was it the wrong strategy for an Internet company to get really, really big first, and worry about profit afterwards? Worked for Google. And Amazon.
Re:No more DVD rentals? (Score:2, Informative)
Most people who earn minimum wage do not live below the poverty line in the united states. Most people below the poverty line are those who do not maintain full time employment throughout the year.
Minimum wage earners usually live in multiple-income houses or are young people still getting economic care from their parents, such as students.
Re:No more DVD rentals? (Score:4, Informative)
Yep.
Re:No more DVD rentals? (Score:5, Informative)
Most people who earn minimum wage do not live below the poverty line in the united states.
Common misconception among opponents of the minimum wage. Can you back your assertions with data?
Federal poverty line for a single person is $11,710 [hhs.gov]
Federal minimum wage is $7.25 [dol.gov] which equates to roughly $14,500 (assuming you only work 50 weeks).
If you work 1615 (about 9.3 months @ 40 hrs/wk) hours at minimum wage, you exceed the poverty line.