Saturday, October 25, 2014

TIME WARNER CHIEF: NETFLIX IS NO THREAT

May 5, 2011 by · Leave a Comment 

Jeffrey L. Bewkes

Time Warner chief Jeff Bewkes insisted on Wednesday that Netflix does not pose a threat to traditional broadcast and cable outlets — and that he has seen little evidence that Netflix subscribers are “cutting the cord.” During a conference call with analysts and investors, Bewkes observed that there are only about 4 million households in the U.S. that have broadband and no cable, “and that number is almost unchanged over the years since Netflix started its streaming — or Watch Instantly — service.” Moreover, Bewkes maintained Netflix does not have the financial resources to offer the kind of content that’s available on the top cable and broadcast networks. “And we don’t think there’s very many subscribers that are going to be willing to give those things up.” But some analysts have suggested that Bewkes may be overly optimistic. USA Today today (Thursday) cited recent reports, which, the newspaper observed, “suggest that Netflix’s effect on Hollywood will be an even scarier movie than the moguls thought.” For example, on Monday, Citigroup analyst Mark Mahaney predicted in a note to clients, that Netflix’s subscriber base in the U.S. will double to 50 million by 2013 and that the company has a “significant international opportunity” to expand quickly into Europe and Latin America, where it is likely to add 43 million additional households. (He noted that Netflix has signed up 8 percent of Canadian households in just seven months.) Mahaney has set a target of $300 for Netflix’s stock, up from $227 today. That’s the same target for the stock set in March by Goldman Sachs analyst Ingrid Chung. She predicted that Netflix will have signed up 60 million U.S. subscribers by 2015.