Why Netflix-Comcast Deal Making May Not Be Done

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Feb. 24 (Bloomberg) -- Bloomberg News’ Edmund Lee and Porter Bibb, managing partner at Mediatech Capital, examine the implications of Netflix paying for access to Comcast broadband network on Bloomberg Television’s “In The Loop.”

Investing reporter and also ed lee.

Ed, let's start with you.

Netflix will pay millions of dollars, even more?

Even more.

They were paying other providers.

Netflix has their own isp.

They were paying somebody to get traffic across the internet.

Content will get faster to comcast customers.

Hopefully speeds will be faster.

What comcast is getting from netflix is what no one has revealed the actual numbers, but it will be -- this is them cutting out the middleman?

This is been under discussion for six months or more and it comes at a propitious times.

It makes comcast look good as the ftc and fcc are looking at the merger with time warner cable.

It is curious timing.

Why would netflix not want to hold off on the steel -- this deal?

The thing of it is is that there is something else that netflix wants.

They want the netflix app to be on the comcast box.

That is something they want to happen.

They want to have the app on the set top box.

This is critical.

What happens to pay-per-view if you can get for $7.99 10,000 movies from netflix?

All of this is driven by speed.

Customers are having a harder time.

There have been serious problems.

I have had problems with netflix.

The internet is managed by a whole series of other third party companies that consumers do not know about.

The way those content companies work with these companies, the way you route your traffic could have a huge difference in how could -- consumers see it.

A lot of times it is not even the isp's that are necessarily the factors.

One of the biggest middleman for netflix is amazon.

A really?

Because amazon has so many other businesses, including the prime.

Content distribution networks and their servers are as big as anybody's in the world.

Amazon is in a unique position, where they are servicing netflix, but also competing.

Very seriously.

They just bought a u.k. version of netflix.

Some are saying that this is another salvo that amazon is lobbying against netflix.

The u.k. is a prime market for netflix.

Love film with amazon has spiked the growth that netflix was looking for in the u.k. they raised money for growth internationally -- they need that money for content acquisition.

The other problem is that in the u.k. and europe, paid television market is not as built out as it is in the united states.

It is more palatable for everyone over there for the streaming services.

Isn't netflix still winning the game here?

Doesn't amazon still have a lot of catching up to do?

The thing that amazon will soon have is a set top box.

That is part of the problem that netflix has right now.

Short of them having their own set top ox, the need to work out these deals with everyone else.

You will not see a netflix app on an amazon set top box.

You have to figure that will be a negotiation.

There is another thing missing from the netflix negotiation.

It is called prophets.

Their content costs are going through the roof.

They have off-balance sheet liabilities approaching $10 billion over the next three

This text has been automatically generated. It may not be 100% accurate.

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