Netflix Looks to Raise $400 Million in Cash

Netflix Inc. said it agreed to raise about $400 million in cash from selling stock and bonds that can be converted into stock, a move seen by analysts as a sign that efforts to acquire video content are proving expensive.
The DVD-rental and online-video company also expects to be unprofitable for 2012, according to the regulatory filing for the fund-raising. The company added that revenues would be flat until its subscriber base rises, but said it couldn't be certain whether such growth would happen.
The announcements come after a months-long rough spell for Netflix. Customers and investors howled after it raised prices on a popular subscription plan by 60% in July, and when it announced in September a since-aborted plan to separate its DVD-rental-by-mail service into a separate business called Qwikster.
The Los Gatos, Calif., company has said it lost 800,000 subscribers in this year's third quarter, while its shares have fallen 74% since the price hike was announced on July 12.

Netflix spokesman Steve Swasey said the company doesn't have a pressing need for more cash, "but it's always nice to have more money than you need." He said the company has no immediate plans to use the funds. He added that subscriber cancellations have continued to decline, meaning that Netflix could soon see its subscriber base grow.

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Netflix 'got overconfident' this year, CEO Reed Hastings says

Netflix Chief Executive Reed Hastings, confirming what his critics have said for months, conceded his company "got overconfident" this year and moved too fast to get its customers to stop ordering DVDs in favor of online streaming.
He also said his company sometimes pays too much for its content.
"Our big obsession for the year was let's not live and die with the DVD," Hastings said Tuesday in an interview at the UBS Global Media and Communications Conference in New York.
Earlier this year, Netflix introduced a new pricing scheme and did away with its $9.99 plan that let users watch an unlimited number of movies online and rent one DVD at a time. Now, subscribers who want that combination will have to pay $15.98 a month — $7.99 for Netflix Instant streaming and $7.99 to receive discs in the mail.
That led more than 800,000 subscribers to cancel the service and caused a multibillion-dollar drop in Netflix's market value.
"It turned out to be a little too fast," Hastings said, adding that Netflix took an image beating similar to the one that Bank of America got for trying to charge monthly fees for use of its debit card. Ultimately, he said, this will be forgotten in a few years when streaming content becomes the primary way people view content.
"Streaming is the future," he said.

Read More - http://latimesblogs.latimes.com/entertainmentnewsbuzz/2011/12/netflix-ceo-hastings-fears-hbo-go.html

Netflix Canada to get more quality content in 2012

TORONTO — Netflix is promising that 2012 will be a big year for the company in Canada, with plans to double its acquisition spending for movies and TV shows and give Canadians access to more quality content -- although it still won't match the selection available in the U.S.
In a letter to shareholders in late October, Netflix said next year's spending boost would give the the Canadian service "comparable content quality" to the U.S. site.
In a recent interview, vice president of content Jason Ropell said the statement implies that Canadians will get access to the same calibre of top-tier films and TV shows available in the U.S., although he conceded the quantity of those titles will still limited north of the border.
Given that Netflix's streaming service has been up and running in the U.S. for about five years and has more than 21 million customers, expecting the same breadth of catalogue on the Canadian side -- which has been online for a little over a year with more than one million subscribers -- isn't realistic, said Ropell, a Canadian himself.
Netflix Canada has "more than a third of the content they have (in the U.S.) but we've only been operating less than a fifth of the time," Ropell said.
"We're already doing fairly well if you compare the two over the same period of time, but within a year I don't see us ramping up to that quantity. But quality, I think we can get closer."

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Netflix’s CEO Sees ‘Arms Race’ to Dominate Video Streaming

Netflix Inc. (NFLX) Chief Executive Officer Reed Hastings said he sees an “arms race” to dominate Web-based TV viewing, with Time Warner Inc. (TWX)’s HBO Go service his top competitor.
“The competitor we fear most is HBO Go,” Hastings said today at a UBS media conference in New York. “HBO is becoming more Netflix-like and we’re becoming more HBO-like. The two of us will compete for a very long time.”
Hastings downplayed the emergence of other competitors, such as Verizon Communications Inc. (VZ) and Amazon.com Inc. (AMZN), saying rivals will have to spend $1 billion to $2 billion a year on content. New competitors also will have to get their offerings on more devices in the home, particularly so-called smart TVs with built-in Web connections, he said.

Read more - http://www.bloomberg.com/news/2011-12-06/netflix-ceo-sees-arms-race-to-dominate-streaming-labels-hbo-top-rival.html