recently upgraded its interface to make it more user-friendly.
The new operating interface is expected to make it easy for users
to browse content of their choice, as it displays more
information about the recommended movies and television shows.
Netflix also updated the search function, which will now display
results as a visual grid of tiles instead of text. The company
also updated the kids section for a better search and viewing
The speedy new interface is available on
's Xbox 360 as well as on
PlayStation 3 and 4 besides Smart TVs, Blu-Ray Players and the
Roku 3 box. However, the new interface will not be available on
Xbox One and Apple TV as well as on smartphones and tablets.
The new interface essentially focuses on television viewers who
form a majority of Netflix's more than 40 million subscribers. We
also believe that Netflix will gradually extend the interface to
other platforms such as tablets and smartphones. This will
eventually help Netflix to attract more subscribers going
Netflix's focus on improving user engagement has been the primary
reason behind its success in recent times. In the recently
concluded third quarter of 2013, Netflix's subscriber base
increased 10.87 million year over year to 40.28 million.
Sequentially, total subscriber growth was 2.72 million.
This strong subscriber addition was primarily driven by Netflix's
expanding content portfolio that includes original productions
Orange is the New Black
, as well as the complete seasons of popular shows from other
production houses such as AMC.
Netflix continues to ink partnerships with major film studios and
production houses. The recent partnership deal with Disney is
expected to provide Netflix a competitive edge over peers that
include HBO and
Although, Netflix's continuous subscriber loss in its DVD
business and higher spending on content acquisition are concerns,
the company's growing subscriber base will continue to be a major
growth factor in the near term.
We believe that the expanding content portfolio, partnerships
with overseas cable television providers and launch in new
international markets will be the primary growth drivers going
Currently, Netflix has a Zacks Rank #1 (Strong Buy).
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