Here’s Why Not All Are Celebrating Netflix’s Recent Stock Boom
The announcement of a deal between Netflix (NASDAQ:NFLX) and Virgin Media in the U.K. may be good news for consumers, but it also forecasts a potentially dismal future for TV networks and distributors.
Netflix TV and movie streaming has long been a concern for traditional media companies as they slowly lose more subscribers each year who opt to pay the streaming service’s lower fees rather than the growing cost of cable television. But while Netflix used to only be available on different TV inputs or devices, this recent deal with Virgin Media reflects the streaming service’s first partnership with a pay-TV provider, and it could be Netflix’s first step into complete integration with regular television.
Thus, it is understandable why Netflix’s recent announcement has both content and pay-TV companies reeling. According to Variety, the streaming service’s stocks skyrocketed past $300 when news of the deal broke, but analysts voiced significant concern for other parties in the entertainment industry.