Netflix, Inc. (NFLX) VS Cable Companies: $90 Fee Difference is the Key


Netflix, Inc. (NASDAQ:NFLX) is getting immensely popular in the US and beyond because of its interesting content in less price as compared to the cable TV services. In an article on BGR, Yoni Heisler said that Cable charges per month are increasing with the passage of time and the end users are not happy with this. Although the number of channels has increased in the recent years, an average user still watches only 17 channels on average, the source quoted a report. Heisler thinks that the end of Cable is near, thanks to the companies like Netflix, Inc. (NASDAQ:NFLX), which are providing best on-demand content and TV shows at around $10 per month. The charges for the same services are around $100 a month, so why would a consumer prefer cable over Netflix, Inc. (NASDAQ:NFLX).

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The source quoted a report which says that cord-cutting trend is on the rise in the US, thanks to services like Netflix, Inc. (NASDAQ:NFLX). More than 5.6 million households are on the brink of cutting the cable cords. Heisler thinks that cable marketing has failed pretty badly. It either tries to imbibe money from the end users by offering them silly offers which one don’t need. Cable marketing also tries to get new customers by offering them limited times offers; like a 3-month subscription on a very less rate. When the user consumes this package, he hardly upgrades it to the full cable service. The marketing failures gives Netflix, Inc. (NASDAQ:NFLX) more chance to gain new customers.

Netflix, Inc. (NASDAQ:NFLX) and other content services have evolved the TV and content business in the US. Cable companies will have to make massive changes in their business models otherwise they are doomed to end.

 Carl Icahn‘s Icahn Capital Lp holds close to one million Netflix, Inc. (NADSAQ:NFLX) shares.

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