Market Overview

What Netflix Thinks About the Disney-Fox Merger


Shares of Netflix NFLX closed at a new all-time high once again on Thursday, as investors continue to gush over the streaming giant's massive user growth. However, looming in the background lies a soon-to-be streaming juggernaut.

Disney's DIS well-documented acquisition of key Fox FOXA assets will allow Disney to combine its own movies and original content with that of Fox's television and film studios. This will give Disney the ability to offer customers a more beefed up version of its own over-the-top streaming service, which is tentatively set to launch in 2019.

But Netflix isn't worried about the entry of a powerful new competitor, which will also take with it nearly all of Disney's and Fox's content down the road. "We don't see it as a threat to us any more than Hulu has been," Netflix's often-candid Founder and CEO Reed Hastings said in its recent earnings interview (also read: What Reed Hastings Credits For Netflix's Historic Growth).

In fact, Netflix has been preparing for such eventualities for years. The company knew that streaming was the future long before most, and therefore, Netflix executives understood that when it really caught fire, networks and entertainment companies would be less willing to license their content.

Netflix has been bolstering its original programming division to prepare for the age of subscription-based entertainment. When asked to speculate about the likes of other entertainment giants starting up their own streaming services, Netflix executives were still unshaken.

"I would say the big bet they have to make to us, can they make more money licensing their content to us or somebody else than they—by having their own services and managing their own services? That remains to be seen," Chief Content Officer Ted Sarandos said.

Hastings even went as far as to say he would happily sign up for Disney's streaming platform when it makes its debut.

The company also reassured fans of the popular Netflix Marvel TV shows that they have nothing to worry about, for now. Netflix has leased the rights to those products and "get to use them for a very long time."

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: contributor contributorsNews Asset Sales


Related Articles (DIS + FOXA)

View Comments and Join the Discussion!