Wednesday, September 24, 2008

Netflix announces deals with CBS and Disney

Netflix continues to cast a wider net. Realizing that DVDs alone does not a business make, Netflix is working hard to expand its brand in online content. Its deal with CBS and Disney allows consumers to get it's content delivered to their PCs. The advantage of the Netflix subscription is that this content is made available without commercials. So you can put up with ads on Hulu or watch without ads on Netflix. Both new and older series will be featured. There is definitely something appealing about a subscription service that enables the user to get content without advertising; but one must wonder how long that can last. It certainly makes the existing Netflix subscription more valued, but is it a stop-gap to subscriber erosion, or will it lead to fee increases to pay for these new content deals. I suspect that advertising-free content will be short term as the need to monetize becomes too great. Still I like the approach and think it will do well for Netflix.

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