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Prepare to Buy Netflix Before It Rises From the Dead

By now, it's clear that Netflix deserves credit for the success AMC Networks (AMCX) has seen licensing the streaming service past seasons of shows such as Mad Men and The Walking Dead. Both companies acknowledge that many viewers decided to tune into the current seasons of these shows after discovering them on Netflix.

I'm not necessarily one for anecdote, but I do believe in synchronicity. Over the weekend, I discovered a show I never knew existed -- Louie, the FX show starring comedian Louie C. K. I am blowing through the first two seasons and plan to watch the current run on FX. I would guess, independent of my experience, thousands (maybe millions?) of others have had the same experience.

There are those words again - discovery and experience.

Pandora (P) set the discovery trend in music. Netflix likely just stumbled upon the phenomenon in video. But more power to them. Now they just have to leverage their ability to be a discovery service in more ways than one.

Netflix must also continue to do a better job creating an experience for its users. It's Reed Hastings' task to envision ways to make that happen. As I have rarely questioned his status as a visionary, I have confidence he will get it done.

Netflix, whether it admits it openly or not, has moved away from the strategy it invented -- buying up any and all streaming content a programmer is willing to sell. That's pretty much what Amazon.com (AMZN) is: a poorly focused smorgasbord of random content. I subscribe to both services and that's my experience.

I plan to give NFLX another several weeks to settle into another range. Once it does -- and that could quite possibly be closer to or even below $50 -- I intend to get long the stock via a buy-write strategy using weekly and/or monthly calls.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

At the time of publication, the author was long P.

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