November 30, 2010 by staff
Comcast Netflix, Netflix (NASDAQ: NFLX) has now presented its plan to stream only the U.S. and 8 for a month after the deployment of a similar program in Canada. In addition, the company also raised prices of its DVD rental plans and DVD streaming. (See details of the new regime on the company’s blog here.)
Netflix is competing with Time Warner Cable (NYSE: TWC), Comcast (NASDAQ: CMCSA), Dish Network (NASDAQ: DISH) and DirecTV (NASDAQ: DTV) for streaming and pay-TV services.
In the short term this could increase the number of subscribers with an option for streaming only and given the rising prices for DVDs, it could maintain or even increase the average subscription price beyond our current estimates. Both countries have a positive impact on our estimated price of 106 and Netflix, which is well below the market price.
A plan for streaming only in the United States and Canada could attract new subscribers and drive the overall average prices. On the other hand, price increases for DVD rental plans and plans for TV plus DVD streaming could mitigate this impact.
We now forecast the number of subscribers reaching about 43 million by the end of the forecast period Tref. If this growth to 50 million on a faster growth of streaming services, which adds about 17% to our estimated price?
Overtime we expect that the add-on “streaming service could become a bigger driver based Netflix rental stores and see the possibility for the new pricing plans to grow the subscriber base, while by offering different price plans to avoid a drop in average prices for its service.
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