news of an analyst price target hike, a new original series and rumors that Netflix will become part of the cable establishment. There's nothing like a momentum stock, particularly in a world littered with macro-level uncertainty. Some alternative, albeit informed thoughts that go against pretty much everything else the Hastings-controlled State media gives you on Netflix. First on the Sony ( SNE) deal. Did you ever wonder why studios such as Sony do deals with Netflix? If you believe the Reed Hastings' propaganda machine, it's because Netflix is the future now. The traditional methods for delivering original programming are a thing of the past. Of course, that's not true. Time Warner's ( TWX) HBO and AMC Networks ( AMCX) continue to perform better than they ever have. The latest evidence: AMC's The Walking Dead scored an 8.2 rating in the 18-to-49-year-old demographic the other night. That's 10.4 million adults. The Walking Dead aftershow scored 5.1 million sets of eyeballs, including 3.3 million 18-to-49-year-olds. There's no way to describe that other than saying it's sick. Not as in anemic, but sick as in not bad meaning bad, but bad meaning good. We don't know because Netflix won't tell us, but I would be willing to wager Reed Hastings that the number of viewers to The Walking Dead post game hit is greater, by a significant margin, than the total number of Netflix subscribers who watched any of the outlet's original series at any one time. But shame on me for allowing facts to get in the way of the Netflix story. Because, after all, if it wasn't for Netflix, AMC Networks, as well as HBO, would be struggling with their originals. We wouldn't be hearing about Breaking Bad, Mad Men, Game of Thrones, The Walking Dead and other hits if Netflix wasn't there to save these fools from their uncreative selves. But, humor my alternative thesis pursuant to the original question: Did you ever wonder why studios such as Sony do deals with Netflix?
Don't believe the company line from Hastings and NFLX bulls. It has less to do with Netflix as this incredible disruptor and more to do with Netflix providing the studios with deals that are too sweet to pass up. Plenty of directors and actors would prefer to go with, say, HBO, but the studio pressures them into going with Netflix. First, Netflix guarantees 13 episodes right off the bat. Sometimes it will even give you a two-season commitment before the first season even airs. And, in terms of rights, it doesn't demand exclusivity. Outside of the first-run window, you are free to place your show anywhere you wish and, unless it cuts another deal with you, Netflix doesn't receive a cut of this action. Plus, there's very little, if any, creative development from Netflix. In other words, the folks who output the content -- in this case, Sony -- are simply robbing Netflix blind. It's the type of deal that's too good to pass up. Put another way, Sony doesn't care how many subscribers watch these shows on Netflix. They're more than happy to collect a fat (likely way too big) check, which subsidizes their risk, as they retain rights to sell the programming in markets where Netflix doesn't operate and in all other markets -- geographic and delivery -- after whatever the relatively short first-run window happens to be. That's not how HBO, for example, plays the game. Never has been. And HBO sees no reason to start, given the franchise it has built and the enormous success it continues to have. HBO doesn't give the world to studios and creators because it's not so desperate that it has to. It maintains exclusive rights to the programming it licenses. Unlike Netflix, it routinely produces programming in-house. And it almost always involves itself in the creative process. From what I understand, producers and directors actually appreciate this input, as HBO has a track record of making stars and producing huge hits. Netflix is taking a massive risk writing big checks and doing whatever needs to be done to secure programming that might wind up elsewhere if "elsewhere" was as desperate as Netflix appears to be. Creators and studios go with Netflix because they can't turn down the easy money or their first choice turns down their programming. It's common to pitch HBO first, get a no and head over to Netflix.
But the even bigger sign of desperation that the media can't help but spin positive is Netflix's renewed push to be part of the very cable establishment it's apparently disrupting and claims to be the antithesis of. You know the Netflix talking points: You shouldn't have to buy expensive packages, premium channel add-ons, be beholden to a programming schedule (even though you really aren't), blah, blah, blah. So, if you're Netflix, why become part of this toxic cable apparatus? The NFLX bulls only consider quick-hit, reactionary outcomes. Becoming a part of cable will increase subscribers. Maybe it will. I wouldn't uncritically accept such a prediction, but we can argue that at another time. It's more important to consider why Netflix would want to be part of the cable model in the first place. While this is nothing new, it's something Hastings has kept in his back pocket for at least a couple of years. Now he has obviously planted the seed somewhere in the media or analyst community that the talks are serious. That Netflix could land as part of domestic cable offerings. I smell subscriber growth problems on the horizon. Why scramble for access to cable subscribers, who are apparently chomping at the bit to cut the cord because Netflix and a smattering of other entertainment choices continue to, as the story goes, present far more attractive value propositions than cable? It makes zero common sense. It's a subscriber grab. And it will work until it doesn't work anymore. Underlying reasons for why things happen matter. In this case, on the questions of why would Sony do a deal like this with Netflix and why does Netflix want to be one with cable. The folks reporting on Netflix in the media and covering the company on Wall Street refuse to do the work to get at these underlying reasons. They're more than willing to let Reed Hastings and Netflix's PR department write their stories for them. Follow @rocco_thestreet -- Written by Rocco Pendola in Santa Monica, Calif.