Chromecast forecast: more Netflix subscribers up ahead

July 25
2:13 PM 2013

Google recently announced its latest device, the Chromecast. The device basically allowed "TVs to become second screens to Google-powered devices" running the Chrome browser. Chromecast was priced at US$35, inclusive of a free three-month subscription of Netflix.

This move, which came at a time when Netflix was expanding its original programming, presented a good opportunity for Netflix. With the arrival of the Emmy Awards show in a couple of months, it was possible that there would be an increase in subscriptions.

More subscribers was equal to more original content production. "Those mere 630,000 net new subscribers should be worth over $60 million in revenue over the course of a year," reported Matthew Yglesias of Slate.

"In other words, with each passign year Netflix has a larger stock of zero-cost content that it produced in previous years. And with each year that it adds subscribers, it gains the ability to produce brand new content at a more rapid pace. That means those $7.99 per-month subscription fees should become a more and more appealing value proprosition, and give the company some scope to increase rates over time," Yglesias added.

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