On solid financial footing, Netflix looks toward original programming

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Netflix ( NFLX ) surpassed expectations when it reported its first quarter earnings this week as revenue surged 46 percent from 2010 and an additional 3.6 million users signed up for the service. The company's user base has become the same size as that of Comcast. 

The results are what analysts have come to expect from the California-based media darling, but it is actively moving to tap into as-yet untouched markets. The movie rental company reportedly spent more than $100 million to license an original series, "House of Cards," from Kevin Spacey and director David Fincher, whose film credits include "The Social Network" and "Fight Club."

Netflix chief executive Reed Hastings said the shift in the company's business model with the original programming purchase could help reach a broader audience and made practical sense. "We're willing to try [something] a little bit more riskier [sic] than we've done [before] with a little bit of our budget , and then we're going to see how it goes," Hastings told investors. "Our theory is that with serialized content, we may be able to build an audience very effectively, because with on-demand you can get back to the first episode as momentum around the series builds."

Hastings, however, said the push into original programming was not a move the company planned to aggressively pursue - at least not right away. "If we're successful, then we'd expand our circle of competency a little bit more, so we'll take it step by step," he affirmed.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: News Headlines , Business , Technology , US Markets

Referenced Stocks: NFLX

Daniel Pereira


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