UPDATE: Netflix Still In Deal-Making Mode; Beats Street Expectations for 1st-Q But Stock Price Dips In After-Market Trading

UPDATE: Netflix CEO Reed Hastings in today’s earnings call says the company’s much-ballyhooed deal to license the original TV series House of Cards is merely a test — and a relatively modest one at that. “I don’t know if it’s anything we’d bet the farm on, but we’re willing to try it with a little bit of our budget,” he told Wall Street analysts. He said in a letter to shareholders that Netflix might make “two or three similar, but smaller, deals” to see whether “we can efficiently build a big audience for a well-produced serialized show.” He said, in his note, that the characterization of Netflix as “rerun TV” is “fundamentally correct.”

Hastings told analysts, though, that he was intrigued by the performance of Starz’ Spartacus, which was also available on Netflix. It “opened our eyes” to the possibility that a show might develop a bigger buzz, and more TV viewers, when it runs on the Web as well as conventional TV. Meanwhile, Hastings says that Netflix is “working hard” to offer its streamed content to Android-powered smartphones and tablet computers. “It’s a big priority for us.” As for the competition in Web-delivered video, Hastings says he’s as eager as anyone to see what his rivals have planned. “We really don’t know what Dish (Network) is up to” with its acquisition of Blockbuster,” he adds. “A big market attracts a lot of competition.”

PREVIOUS, 1:30 PM: Netflix continues to strengthen the sense of inevitability that it will become a must-have service for Web users who want to watch professionally produced entertainment. It said Monday that it ended the first quarter with a net profit of $60 million, up 88% vs. the same period last year, on revenues of $719 million, up 46%. That comes to $1.11 in earnings per share. In January the company told investors that revenue could go as high as $717 million while earnings would come in between 90 cents and $1.13 a share. Even though Netflix often beats its own guidance, analysts considered that ambitious: The consensus was $703.6 million and $1.08.

Most underestimated Netflix’s appeal to the fast-growing number of people watching movies and TV shows via broadband. It had 23.6 million global subscribers at the end of March, a gain of 3.6 million so far in 2011 and close to the 23.7 million at the top of the target range it set for itself in January. That makes Netflix the largest subscription entertainment service, surpassing Comcast’s 22.8 million subscribers and Sirius XM’s 20.2 million. Some 22.8 million of Netflix’s customers are in the U.S. Now the company says it expects to have as many as 25.9 global million subscribers at the end of June. It projects second quarter revenues of as much as $798 million, and earnings per share as high as $1.15. Read More »

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TOLDJA! EPIX-Netflix Online Streaming Deal

2ND UPDATE: Deal is done. See news release below.

UPDATE: I’ve learned that as soon as tomorrow there’ll be a news release about EPIX giving Netflix exclusive online rights to films from its partners — Paramount, Lionsgate, and MGM — for the next 5 years in exchange with $1 billion in licensing fees. Of course, who knows what those 5 years will bring in terms of product? Paramount has been self-financing its limited product and mostly distributing pics, Lionsgate is fighting a hostile takeover, and MGM is a corpse waiting for an afterlife. But all Netflix seems to care about these days is supposedly shaking up the pay channel world with exclusive online streaming deals like the recent one with Relativity Media. And who knows what shape Ryan Kavanaugh’s company will be in a few years.

NEW YORK and BEVERLY HILLS, Calif., August 10, 2010 – EPIX™ and Netflix, Inc. [Nasdaq: NFLX] today announced an agreement through which Netflix members can instantly watch an array of new releases and library titles from EPIX streamed over the Internet from Netflix. Movies from the multi-year deal will begin streaming from Netflix on September 1 and include movies from Paramount, Lionsgate and MGM.

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Kavanaugh Considering IPO For Relativity

So this is why Ryan Kavanaugh’s Relativity Media keeps gobbling up every deal in sight, including most recently allying online with Netflix and acquiring the 45-person marketing and distribution staff of Starz’ Overture, which is shuttering. Because he just told Bloomberg: “Down the road, we’ll be looking at several … Read More »

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Netflix Sets Streaming Deal With Relativity (…Which Now Wants To Self-Distribute)

2ND UPDATE: I’ve just learned that Relativity Media will be in the distribution business sooner rather than later as it attempts to become a mini-major. Hmm.

UPDATE: relativity mediaThis exclusive deal with Netflix might be impressive if more of Relativity … Read More »

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