Netflix returns to profitability, HBO rejects the thought of a partnership

Matthew DeCarlo

Posts: 5,271   +104

In its recent earnings report, Netflix teased the possibility of partnering with HBO -- a deal that would potentially allow cord-cutters to keep up with popular shows like Game of Thrones without relying on illegal filesharing services.

Unfortunately, the premium network quickly dismissed the notion yesterday: "We are not in discussions and have no plans to work with Netflix," said HBO spokesman Jeff Cusson.

Despite that rejection, Netflix has a positive outlook. The company reported revenue of $889.2 million for the second quarter, up 13% from $789 million in the year-ago period and in line with expectations.

Net income totaled $6.16 million, returning the company to global profitability after a loss in the first quarter associated with expansion in Latin America and the UK.

Netflix expects these figures to be roughly mirrored in the third quarter, predicting sales of $890 million to $911 million with a profit of $8 million, while it expects to post a loss in the fourth quarter due to expansion in Europe. The company said it is focused on entering new territories over the coming years and that will likely result in little meaningful growth in net income.

The second quarter added 530,000 new users in the US and 560,000 across Canada, the UK, Ireland and Latin America, bringing the total subscribers to just under 24 million in the US and 3.62 million abroad. These figures fell short of expectations as analysts anticipated 24.3 million US subscribers and 3.7 million overseas, but Netflix seems happy with the growth.

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Why is Hollywood shooting themselves in the foot while simultaneously trying to hang onto outdated business models. Netflix is a perfect legal way to watch movies online that people *want* to use and completely willing to pay for. Yet these big companies restrict their big new releases and most anticipated content from Netflix and similar services. So now a user will go to an illegal source instead of a legal one to get the latest and greatest movie online. I'm not justifying piracy, I'm just giving you the reality. People *are* going to watch the latest movies online whether it's a legal or illegal way. So why not just give them the legal path when they're willing to take it?
 
I have never understood how these big studios get away with not licensing to others in a reasonable way. Why is it so different from a patent(ok I understand the difference), a company must license at "reasonable" terms, right?
The big studios and cable companies are fighting the last vestiges of the old way, instead of looking forward. I for one am looking forward to the day when cable is ala cart. Five dollar on demand movies, suck it Comcast. Four hundred channels........... I dont care to see 380 of them.
 
Well then.....back to piracy it is! The money table spins round and round
 
RH00D
The answer is: Power, Greed, Ego; many individuals have not yet learned about cooperation, they are still stuck in competition, control and power. Many of these people run companies and if you have been in control for many years raking in the profits, it's hard for these people to see the light of the new way. The music industry seems to get it (though it took them a while), though the movie industry has not yet. If you offer quality goods at a fair price people will buy your goods this is a cooperative model, if you offer subpar goods and try to squeeze every drop of blood from someone this is a ego based model which people will rebel against. Some by stealing, some by not buying the goods and many who still buy but simply complain.
 
They will fall in line...It will take a few more years as piracy increases and increases and profit decreases. Like the music industry finally had to do.
 
The music industry didn't get there on it's own, Steve Jobs apparently got them together and banged there heads until they understood (at least that's what I watched in a documentary).

But I do agree, the different studios will each do there own thing, fail miserably, will give up and we'll end up with one universal service
 
I pay for netflix and lovefilm (amazon service) but I still end up on torrents because of the slow update of the UK services with current content. Take for example true blood on in the US it will be a good 12 months before its aired in the UK in this day and age there is no reason for that. It's almost as if they want ppl to illegal download so that they can sue them as its a better revenue generator that the actual purchase of the content.
 
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