We're the first to recognize that Netflix must reinvent itself after DVDs become obsolete. The company is hardly invincible, but all this doomsday "Netflix Death Watch" stuff seems a bit over the top to us.
Ron Galloway, who is keeping morbid tabs on the company over at HuffingtonPost.com, argues that Netflix is going to get eaten alive by Apple, Sony, and set-top box providers that offer video-on-demand.
"Apple is selling/renting 50,000 movies and TV shows per day, many in hi-def," says Galloway.
He makes a reasonable argument until you consider the fact that Netflix ships 1.6 million DVDs daily (according to the USPS) and grew its 8.2 million subscriber base by 21 percent last quarter. Apple's puny 50,000 sales/rentals are lame by comparison.
Galloway also says Netflix' core business is rental by mail and that the company doesn't have a growth engine. Again, he's right. But we've spent ridiculous amounts of time on the Netflix site, rating movies, looking at friends' ratings, and generally wasting absurd amounts of time; for better or worse, a Netflix account almost becomes an emotional investment, so it's more than just a plain old mail rental service.
We don't deny that Netflix has its challenges -- including surging gas prices and creeping postal costs -- but the company isn't dying any time soon. The stock, however, is a different story . . .
See Also:
- Netflix Keeps Profiles; Whining Customers Win
- Netflix, LG to Bring Streaming Movies to TVs
- Apple Loves Digital Distribution; Blockbuster, Netflix Aren't So Sure
- Netflix Still Kicking it
- Netflix Ditches Online Viewing Limits Ahead of Macworld
- Postal Rate Hike Could Put the Squeeze on Netflix
- Netflix Vs. Blockbuster: Price Cut War Begins
