Netflix, Inc. (NASDAQ:NFLX) has certainly awakened quite a few analysts and investors of late, as its dive into producing original digital streaming content has been a huge hit, as evidenced by the dramatically large numbers in the company’s quarterly earnings report released this week. Crediting its original series, “House of Cards,” Netflix grew by 3 million subscribers (11 percent) in a single quarter in the first thee months of this year, and the company passed the $1 billion mark in revenue for the first time.
And while Netflix, Inc. (NASDAQ:NFLX) is seeing solid returns on its early investments in original content (the thriller series “Hemlock Grove” kicked off last week, and the reincarnated Jason Bateman comedy series, “Arrested Development,” will show its fourth season in full starting Memorial Day weekend), moe can be said for investors, as the stock has moved up more than 2.5 times just in the last six months, helping the company top $12 billion in market cap.
My colleague, Jake Mann, looked deeper into Netflix, Inc. (NASDAQ:NFLX) and saw more than just the gaudy numbers the company has posted recently. He found the company’s “Long Term View,” an actual document that is more than a mission statement, but a story that Netflix tells to its investors and stakeholders about what it is looking to do – not just guidance for the next one or two forward quarters, but years and decades ahead. Netflix is setting itself up well with its library of curated content and now its production of original content in serials – and we’re guessing that motion pictures won’t be too far behind, either.
However, one part of the “Long Term View” caught my colleague’s eyes, and mine too, so that it’s worth a look: Netflix, Inc. (NASDAQ:NFLX) acknowledges that it considers HBO a competitor, and specifically mentions the premium-cable network specifically several times, but Netflix also mentions ESPN a few times as well.
Netflix basically says it’s trying to stay out in front of HBO as much as possible. But why mention ESPN?
While ESPN is a channel devoted strictly to sports, it is the top channel for live programming that is out there – with the possible exception of C-SPAN, but no one watches congressional hearings or floor votes without a vested interest.
ESPN is one of the best at producing live content, and it distributes it in many ways – with several dedicated websites and apps that work on virtually every mobile device. Netflix, Inc. (NASDAQ:NFLX) also has apps across many devices as well, and its video and audio quality is impressive and state-of-the art. So why would Netflix be angling for ESPN, when Netflix has shown no interest in sports to this point?