Netflix Inc., a US-based provider of on-demand internet streaming media, is negotiating with many US cable television companies, including Comcast and Suddenlink Communications, to offer its Netflix streaming service on their set-top boxes using the Netflix app. A report by the Wall Street Journal points out that Netflix is discussing the possibility of setting up a direct connection of the Netflix network to the cable companies’ internet service provider systems, a move that is expected to offer consumers the best viewing experience.
Netflix wants cable companies to adopt a special technology that is designed to improve the quality of its streaming video. Currently, Netflix has almost 30 million streaming subscribers in the US who pay $7.99 a month to access the company’s offerings. As a prelude to the deal, Netflix shares jumped nearly 7.82% to $324.36 on Monday. Over the past month, Netflix’s share rose 12.46% and surprised the market with a 25.73% gain in the last three months.
As of now, Netflix subscribers use the company’s apps to watch shows on their tablets, smartphones, and computers. However, they have touse a Rokuset-top box or Apple TV, or a connected television to watch the service on their TVs.
Currently, no US cable company offers direct access to Netflix through their set-top boxes. The cable and satellite-TV providers focus on their own on-demand offerings. On the other hand, Comcast, touted as a rival to Netflix, offers streaming video through its Streampix option.
In September, Sweden’s Com Hem and Britain’s Virgin Media signed deals to allow their customers to access Netflix through Tivo set-top boxes. With this move, Netflix could be offered as an option to the viewing selections from US cable companies.
WSA’s Technical View on Netflix
Netflix Inc. (NASDAQ:NFLX) is trading above its 20-day, 50-day, and 200-day simple moving average, which gives a bullish signal to investors. RSI indicates market is still biased toward bulls. Even though Williams %R suggests that the stock is trading in overbought territory, majority of the technical indicators still suggest a strong buy on Netflix