You Can’t Be Serious

TheStreet.com is reporting the rumor-that-won’t-die

Netflix is spiking as rumors surface yet again that Amazon is interested in acquiring the company. (BWAHAHAHA)
These rumors have surfaced many times over the last several years in regards to Netflix, most recently in January. Each time analysts have dismissed the claims. (Duh)
While anything is possible (note the Hewlett-Packard-Palm deal), Needham analyst Charles Wolf says it is unlikely.
“Amazon would not acquire Netflix for its by-mail business, which will eventually go away” he says. While Netflix has a terrific digital-streaming business, its library consists of mostly older films. It can’t offer new releases as they are available because it is too expensive.
Amazon, itself, has a streaming pay-per-view service for new releases, and it doesn’t seem like there is a barrier preventing Amazon to offer old movies, Wolf says. “So the company has little reason to buy Netflix.”

The rumor is moronic, yet the shares are up 7.5% today. Once again, welcome to Wall Street-istan!!

Posted by on May 12th, 2010 at 3:44 pm


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