Friday, January 14, 2011


If you read this blog and listen to the AudioBoos, you know I talk a lot about $NFLX and content delivery. Today on the Boo I mentioned RedBox (Coinstar) and the sell off on the latest earnings report.

As I said, I missed the stock move in Netflix, even though I use it quite a bit. Peter Lynch would rate that a fail, right? Anyway, I don't trust the sector. I believe that there are major players in the game. Who? Well, who provides us entertainment? It's Comcast, DirecTV, Dish Network, Wave broadband, Netflix, Hulu, ATT, Apple, Google, Roku, Microsoft, Sony, Amazon, etc. I'm sure I'm missing a few. And these companies want your eyeballs on their content and advertising. So, I just don't trust investing in Netflix or Redbox (Coinstar).

At some point there will be consolidation, winners and losers, or maybe new players as the technology keeps evolving and improving.

Here is an article saying that maybe the recent earnings report by Coinstar indicating that Redbox is failing against Netflix may be overstated.

That's telling. It's probably a mistake to view Coinstar's results as a sign that Netflix is hammering nails in Redbox's coffin. ... It doesn't appear that consumers were suddenly less interested in watching DVDs during the holidays. In fact, Coinstar CEO Paul Davis said in a statement Thursday that visits to Redbox kiosks in the fourth quarter "remained strong." It's just that consumers rented fewer movies -- meaning they stopped by but didn't spot as many titles they wanted to take home.

So, they rented fewer movies or they diversified their choices? I don't know.

All I know is that there are ever expanding options to get movies to my big-screen TV. I've opted (so far) to the low-cost Roku box to stream Hulu and Netflix to the TV. I'm enjoying the content and avoiding the stocks.

Oh, and doesn't Coinstar charge something around 7% to redeem your coins to cash? Credit union, people! Credit union!

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