Friday, April 24, 2009

Add This to the New Media Logpile

Netflix shows profits as more budget-conscious Americans are embracing low-cost movie rentals over higher-priced theater tickets, a trend that helped Netflix to again deliver better-than-expected earnings.

The company says its download service, which it offers free to higher-tier subscribers, is gaining traction. Earlier this month, it announced deals to stream back episodes of Comedy Central's popular "South Park" animated series, and Nickelodeon shows such as "SpongeBob SquarePants."

But the company also noted the growing competition from cheap DVD rental kiosks.

"We're seeing a major shifting in the landscape between the content providers, different distribution models and the competitive environment," Janney Montgomery Scott analyst Tony Wible said.

Analysts asked about plans for a new pricing tier of streaming-only service, without the discs. Netflix said Thursday it's not a top priority at the moment.

Michael Pachter, an analyst with Wedbush Morgan Securities, said the transition away from DVDs will take years, but added that Netflix is smart to start weaning its customers off the plastic discs.

D2N (Direct-to-Netflix) on the horizon?

1 comment:

Craig Zablo said...

Love the new Steranko header!