Q1 Report Due Monday: Has Netflix Plan Worked?
Netflix will publish Q1 reports on Monday; will their big spend on original material have paid off?
On Monday. Netflix will announce its Q1 financial reports, revealing whether or not its ambitious foray into the world of online streaming and creating original content for its customers has actually paid off, Bloomberg Businessweek reports. Netflix’s online streaming service seeks to eliminate the cost of posting DVDs to customers, as services such as LoveFilm currently do (though they also offer some streaming services as well). However, they have also ventured into the world of creating new and exclusive content for their members.
The Businessweek report suggests that the rights spent on original programming will have set the company back by around $100 million, with their Kevin Spacey-led series House of Cards being by far their biggest outlay. The series has been a hit with critics, but whether or not that’s enough to have tempted enough new custom over to the service remains to be seen. Back in January, Netflix forecast that they would have snared between 28.5 million and 29.2 million US subscribers by the end of March 2013. Investors will be looking for the result to be in the higher end of that range.
A big coup for Netflix, of course, is the procurement of the return of the highly popular US TV series Arrested Development. The show was cancelled by the Fox network after 3 series, though public affection for the show has remained strong and its return is eagerly awaited. The company has expressed no desire to increase the rate for its service, which stands at $8 per months in the USA.