NEW YORK (TheStreet) -- Last week, Bernstein Research analyst Todd Juenger speculated that Disney (DIS) and Viacom (VIA.B) will pull the kids' programming they license to Netflix (NFLX) from the video streaming service. In a nutshell, Juenger chalks up ratings declines on kids' television shows to Netflix's impact.
In this article, I assess Juenger's contention. Then I consider whether or not his scenario has any chance of unfolding. I close by discussing the larger ramifications for Netflix and the overall media space.
The Netflix Value Meal
When you stop and think about it, it's as unhealthy as McDonald's (MCD) used to be and still can be. You pay Netflix $8 a month and plop your kid down in front of the computer so he or she can consume hours upon hours of iCarly and SpongeBob reruns. This approach to child rearing can bring on the munchies, pack on the pounds and save some families cash if they cut all or part of the cable cord. How many kids really know or care if they're watching the latest episode of SpongeBob or the reruns Viacom sells to Netflix?
This decision is a result of our strategy to protect the premium nature of our brand by preserving the appropriate pricing and packaging of our exclusive and highly valuable content. With our current studio rights and growing original programming presence, the network is in an excellent position to evaluate new opportunities and expand its overall business.
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