Disney To Buy Netflix? Why It Is A Good Or Bad Idea

By Joyce Vega - 20 Oct '16 21:50PM

There have been reports on a sudden rise in Netflix stock prices. What can be a possible reason for it? The rumors for a possible acquisition may just be what has stricken the prices up.

According to Seeking Alpha, the possibility of acquisition has always been there, since the company started having a big success of both national and international level. Now, that the prices are high the owners of Netflix have the perfect opportunity to increase to the roof all potential profits from sales. One of the main questions remains who will be the buyer to make the best offer and acquire the successful company?

Inquisitr points out Disney as one of the main player in this possible deal. They point out that the online streaming market is a business which will first see its grown, while traditional channels of information like TV and Disney’s owned ESPN suffer from the rising amount of “cord cutters”, in other words, people who prefer to switch from television to direct online stream.

Another good reason they point out is the attempts of Netflix to standardize their service, by pushing a single-fee of $9,99. This will stabilize the platform’s clientele numbers and is also a possible attraction for newcomers, who will be attracted by this single form of payment.

Forbes magazine has released an article against the possible acquisition of Netflix by Disney.
Their main points include differences in image and practices, where Netflix as a platform steadily increases its popularity by releasing own popular productions like “Orange is the new Black”, which are completely different from the image which Disney would want to keep in front of the public.
Another problem is the fact that even though increasing in value, the streaming market is still not that much secure. Netflix throw huge amounts of money on promoting their production and services on global level, which puts them in an unfavorable position when it comes to profits.

On the other side, the current acquisition of Netflix by Disney would costs more than $50 billion, which is a ridiculously large sum of money, amounting to a third of Disney’s full yearly profit.