Nice try, Netflix

[CD Boogie]

But I use my ex-mother-in-law's Netflix log in, so this is actually GOOD news....

Netflix raising prices for 58M US subscribers as costs rise

 

[User 149557]

Will my Betamax by mail subscription still be grandfathered in, though?

 

[The Big Ragu]

That headline isn't quite right.

Costs rising?

Netflix has been a cash incinerating machine the last several years. The company burned through more than $3 billion in borrowed money last year, at junk bond interest rates, to be a content creator on a large scale. It has plans to burn through that much or more this year, in an environment in which junk bond issuance has dried up, making it much harder to borrow heavily to the tune of billions of dollars the way Netflix has been able to for the last 3, 4 years.

When you have $9 billion in accumulated debt, and you have locked yourself into obligations to spend another $18 billion or so over the next five years, and you don't generate enough money to actually support that level of spending, your problem isn't that costs have gone up. It's that you were living in la la land all along. It's not a coincidence that "costs rising" only became a problem when the credit markets tightened and there was no market out there for more junk bond issuance.

 

[Regan MacNeil]

Jesus, you can't make a buck in this market. The country's going to hell faster than when that son of a ***** Roosevelt was in charge. Too much cheap money sloshing around the world. The worst mistake we ever made was letting Nixon get off the gold standard.

 

[playthrough]

All that money spent on creating content and I'm still more likely to just watch Cool Hand Luke or The Big Lebowski again.

 

[Regan MacNeil]

You're doing yourself a disservice then. There's a ton of good, original content on Netflix. Some real ****, too, but a lot of good.

 

[CD Boogie]

You're doing yourself a disservice then. There's a ton of good, original content on Netflix. Some real ****, too, but a lot of good.

Their movie selection blows.

 

[playthrough]

You're doing yourself a disservice then. There's a ton of good, original content on Netflix. Some real ****, too, but a lot of good.

Oh, I know. There's just so darned much of it, I'll spend 20 minutes filling my saved queue and then give up. I'd have to quit my job, quit sleeping and quit watching live sports just to make a dent. Plus it's so darned hard to find a show my wife and I agree on ... and right now that's "The Marvelous Mrs. Maisel," which isn't Netflix.

 

[heyabbott]

And still NBC CBS and ABC fail to produce competitive quality content. Maybe they’ll reboot Mannix and Barnaby Jones. Recast with a Hispanic Woman and Asian man.

 

[Regan MacNeil]

I don't even know how to respond to someone claiming there's no quality content on network television.

 

[LongTimeListener]

That headline isn't quite right.

Costs rising?

Netflix has been a cash incinerating machine the last several years. The company burned through more than $3 billion in borrowed money last year, at junk bond interest rates, to be a content creator on a large scale. It has plans to burn through that much or more this year, in an environment in which junk bond issuance has dried up, making it much harder to borrow heavily to the tune of billions of dollars the way Netflix has been able to for the last 3, 4 years.

When you have $9 billion in accumulated debt, and you have locked yourself into obligations to spend another $18 billion or so over the next five years, and you don't generate enough money to actually support that level of spending, your problem isn't that costs have gone up. It's that you were living in la la land all along. It's not a coincidence that "costs rising" only became a problem when the credit markets tightened and there was no market out there for more junk bond issuance.

Does this ******* board still listen to this crazy ****er about economics? Here's what the real world is saying, that part of the world that hasn't carried a nihilist boner for 10 years now.

Here's how Goldman Sachs is playing earnings season: Buy Netflix, sell Tesla

Goldman Sachs is seeing an 18 percent gain for Netflix over the next 12 months, joining a chorus of bullish commentary from Wall Streeton the video streaming giant. Shares of Netflix have gained more than 26 percent in the new year.

Netflix Flexes Its Pricing Power -- The Motley Fool

The willingness to roll out another price increase not long after its increase in 2017 reflects management's confidence in its pricing power. Pricing power, of course, is an invaluable asset for Netflix as the company aims to keep spending aggressively on content while growing revenue and operating profits.

Netflix Q4 Earnings Preview

In terms of the upcoming results, the group has given the following guidance as what we can expect for Q4:

• Increase in paid net additions of 7.6m (+15% year on year)
• Increase in total net additions of 9.4m (+13% year on year)
• Q4 operating margin to be in a range of between 5% and 7.5% year on year
• Full year operating margin to be between the 10% and 11% range in 2018

 

[The Big Ragu]

I'll guess that demand is more than a little elastic for a Netflix subscription. Maybe not to the point that you get massive numbers of people letting their subscriptions go for the extra buck or two at the current level. I will actually guess that a lot of people will give up a lot of other things before letting go of their Netflix subscription. They have people on the hook. But if they reach the point where they start to lose subscribers, let alone deliver on the subscriber growth that it really needs to justify its equity valuation, it's a serious problem for the company. Because built into that equity valuation is a heck of a lot of subscriber growth. The content creation strategy works when they can borrow billions upon billions of dollars at ultra low interest rates and there is a market for the debt because people are forced to reach for yield. When, as you started to see now, yields rise or high-yield debt credit spreads start to blow out, and there is no longer a market for that debt, Netflix can't borrow that way. The catch-22 is if it raises subscription prices to try to cover some of their spending, and the higher fees cost them the subscriber growth they need.

 

[BitterYoungMatador2]

Oh good. More money for stand up specials by no talents like Ilisa Slessinger and nobodies that haven’t been doing comedy 10 years.

 

[typefitter]

My show is coming to Netflix in early 2020. Please continue to subscribe.

#notahumblebrag #justabrag

 

[Regan MacNeil]

Oh good. More money for stand up specials by no talents like Ilisa Slessinger and nobodies that haven’t been doing comedy 10 years.

Yeah, Patton Oswalt, Dave Chappelle and John Mulaney suck.

 

[poindexter]

My show is coming to Netflix in early 2020. Please continue to subscribe.

#notahumblebrag #justabrag

An adaptation of this message board to a netflix show?

What will they think of next?

 

[HanSenSE]

An adaptation of this message board to a netflix show?

What will they think of next?

They could do years of true crime documentaries on the Poin Files alone.

 

[DanielSimpsonDay]

They could do years of true crime documentaries on the Poin Files alone.

 

[BitterYoungMatador2]

My show is coming to Netflix in early 2020. Please continue to subscribe.

#notahumblebrag #justabrag

If I see a coffee machine repairman in the first 10 minutes of watching I swear...

 

[CD Boogie]

I don't even know how to respond to someone claiming there's no quality content on network television.

With links to shows that prove otherwise?