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Wednesday, July 13, 2011

Why is Netflix expanding so quickly?

Do you think Netflix (NFLX) stock has risen quickly? Well it has been by far the best investment I have ever made.  The stock has appreciated 916% in under 5 years..  This kind of appreciation would be great for 50 years, let alone for under 5 years.   In this day in age of rapid movement, where a company can go from hero to zero in just a few years time(RIMM, NOK, HPQ) growth and earnings go hand in hand, and when it's your time, you have to go.  You have to go quickly because the other guys are planning right behind you. I think this is the reason for Netflix's grand plan of rapid growth..

"You snooze you lose.." This phrase can be so true in business and more in the technology world, even in investing, waiting for a perfect entry.  Without a doubt the board of Netflix feels that if they don't move now they will lose their chance to maximize their control of the online movie community.(Globally)  The one chance to be the dominant player in a new field, a field that could be around for a very long time.

For some reason some major players believe the CEO of Netflix is a real smart guy.. This new guy in the digital field is now on the board of Microsoft and Facebook, two of the biggest names in business and consumers.. (If you think Facebook is not in business, you are way wrong!!) With the CEO being on these boards will it open up a gateway to a direct link for Netflix to go on let's say the next windows operating system as an integrated feature bringing the desktop ever so closer to the living room and not just the office?? Or how about Netflix movies playing on your facebook page as you see your updates? It is no secret, people now watch tv while checking their facebook.. So the questions becomes why not integrate facebook and tv? Why not bring in a netflix player on your tv screen within facebook.. Both riding the success of each other to a higher level..   Facebook hitting the big screen and Netflix hitting the social network with the biggest player in town.

Netflix will grow, might even grow hated by those few consumers who jumped in early and took advantage of some very low pricing.  In the end, Netflix has really big potential! Even more now that it has the scale of size, two great partners, and the advantage of being a trend setter.  With the new pricing of 7.99 and 15.98 just released you will see some consumers change in how they view Netflix so expect big swings in the near future..

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