Hollywood Strikes Will Make ‘Netflix Stronger and Their Competitors Weaker,’ Analyst Says (Video)
Netflix stands to benefit from the dual strikes underway in Hollywood while competitors like Disney and Apple will get “weaker,” in part because of the streamer’s vast international production pipeline, a top media-stocks analyst said Wednesday on the brink of earnings season.
“The strike plays to their advantage,” Michael Nathanson, founding partner of SVB MoffettNathanson, said on CNBC’s “Squawk Box.” “I’ve not been a Netflix bull, but their setup for this quarter and the next 12 months is incredibly strong.”
Co-host Andrew Ross-Sorkin seized on that notion, seeking to clarify whether Nathanson meant Netflix would get stronger merely relative to its competition – or if it could help the streamer overall. The answer seemed to be: a bit of both.
“I think relative, clearly, right?” Nathanson said. “You had (Disney CEO) Bob Iger on air last week – I’ve never heard him sound so bearish. The backdrop for traditional media is really tough. Our investor base is looking for ideas in media, and there are very few to feel good about.”
Co-host Rebecca Quick asked whether “everybody could suffer” from consumers changing their habits should the strikes drag on for a long time – and that’s where Nathanson explained how Netflix could get into net-benefit territory in the coming months:
“Netflix has had – and no one else has – that International production of content,” he said. “We’ve said it’s a lot like automobile unions – if you experience troubles in car manufacturing, international cars would take their place. Netflix has such an advantage in their scale of global production … the problem here for the strikers is that it’s going to make Netflix stronger and their competitors weaker.”
Watch the entire exchange in the video above.
