Netflix stock hits $200 for the first time
As some in the movie business grapple with how big a role Netflix will play in their future, Wall Street seems confident that it will keep growing.
The DVD and online video subscription company's stock on Monday hit $200 for the first time before closing slightly lower at $198.92. Its market value is $10.39 billion.
Netflix stock has skyrocketed 261% this year as investors have been impressed by rapid adoption of the company's streaming video service in place of mailed DVDs, as well as new content deals, most notably one in August with the pay cable channel Epix. It has also rapidly added subscribers, jumping from 12.3 million at the end of last year to 16.9 million as of Sept. 30.
As Netflix's influence over movie viewing in the home increases, however, industry executives are closely monitoring whether its success is coming at the expense of studios.
At a recent panel of several home entertainment presidents, relations with Netflix was a hot topic of conversation. While the company pays studios hundreds of millions of dollars per year to acquire content for its streaming service and for the DVDs it mails, some in Hollywood are concerned that it is cannibalizing more profitable DVD sales and video-on-demand transactions. That's one reason four of the six studios currently don't allow Netflix to offer some of their movies until 28 days after the DVDs debut.
"While there are things in the Netflix system that are clearly cannibalistic [to sales], there are things we can change," Universal home entertainment President Craig Kornblau said at the event. "They can pay us more or we can reduce the quality of what we give them."