This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Netflix Is The TV Content War's New Battleground

PORTLAND, Ore. (TheStreet) -- If we're headed toward a la carte television, as my colleague Rocco Pendola has suggested on multiple occasions this week, guess who's going to get stuck with the bigger bills?

No, not cable and satellite customers who get to structure their offerings lists as DirecTV, Comcast, Verizon and others tell content providers like Fox, Viacom, Disney, AMC and The Weather Channel to take their fee complaints walking. There won't be any more back-and-forth between service and content providers or nasty blackouts mixed with snippy commercials. If television goes a la carte, the viewers are going to set the prices themselves based solely on demand.

Nope, the only way content providers are going to be able to jack up their fees and squeeze more money out of deals for their shows is to target the one company in the room that will still be doling out cash for such things: Netflix. The company's recent deal with Comcast for bandwidth and the potential for similar payouts to Verizon and others left Netflix's big, fat wallet sticking out of its back pocket. As most of the content providers already know, Netflix has been robbed by their like before.

This is a company that isn't terribly opposed to making painful compromises for the sake of content. It locked in Disney to an exclusivity deal, sure, but it let exclusive content deals with Epix and Starz slip away to make that happen. It hammered out agreements with Warner Brothers and Sony half a decade ago, but gave away the right to rent or stream anything resembling a new release from either of them.

Must Read: Why 'Let It Go' From Disney's 'Frozen' Needs an Oscar

With the cable and satellite providers in no mood to negotiate soaring fees and Fox, Time Warner and Comcast's own NBC Sports building sports ecosystems to rival that of ESPN and its $5.50-a-month flagship station, the content providers are losing any semblance of leverage they once held.

Except where Netflix is concerned. That company is still concerned with locking in exclusive content and warding off advances by Amazon, bumbling network joint venture Hulu Plus and Verizon's still tiny Redbox Instant collection.

While cable and satellite companies can drop the redundant Weather Channel and a whole bunch of niche networks without batting an eyelash, Netflix would be in serious trouble if its viewers suddenly were unable to binge watch the last episodes of Mad Men or couldn't catch up with the all of CBS' How I Met Your Mother before its season finale.

Netflix has built its streaming service around two core strengths: Television series and children's programming. The movies are nice, but rarely are they exclusive to Netflix and seldom do they stick around for a year or more. By contrast, viewers have just as much access to back episodes of Scrubs and Cheers as they had two years ago and have Disney content joining a network already stocked with DreamWorks, Nickelodeon and PBS kiddie offerings.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
DTV $0.00 0.00%
AMZN $679.06 2.15%
CMCSA $61.75 1.46%
NFLX $125.37 1.65%
TWC $186.50 0.94%


Chart of I:DJI
DOW 17,888.35 +168.43 0.95%
S&P 500 2,102.63 +22.22 1.07%
NASDAQ 5,156.3060 +47.64 0.93%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs