In an exclusive report, Reuters reveals that Netflix Inc. (NASDAQ: NFLX) CEO Reed Hastings has been meeting with executives of US cable companies seeking a deal that would include Netflix’s streaming video offerings as an optional service from a cable provider. According to Reuters’ sources, Netflix access would become just another premium service on a cable subscriber’s bill in much the same way as HBO from Time Warner Inc. (NYSE: TWX).
This might have been a reasonable option at one point, but with many of the cable and wireless carriers already having plans for doing their own streaming video, Netflix might be too late. Dish Network Corp. (NASDAQ: DISH) acquired Blockbuster; the Redbox operations of Coinstar Inc. (NASDAQ: CSTR) has formed a partnership with Verizon Communications Inc. (NYSE: VZ); and Comcast Corp. (NASDAQ: CMCSA) plans to roll out its own streaming service, Streampix, later this year.
Another possibility, of course, is that Hastings is shopping the company. But its hard to pick out a possible buyer, even though the company is valued at about a third of what it was a year ago. Netflix’s market cap today is around $5.9 billion, not massive certainly, but both Time Warner and Comcast already carry heavy debt burdens and financing such a deal, with so much opposition already gearing up could be a real problem.
Investors could be looking at this report as an act of desperation too. Netflix shares are down about -3% today, at $106.00 in a 52-week range of $62.37-$304.79.
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