Lisa

Is Netflix a Short Term Sell or a Long Term Buy?

Good article.

The SAC is an interesting data point on the Internet ad market. Specifically, the article said:

"Part of the SAC decrease can be attributed to adjustments in the ad market related to the economy. (Financial services firms that typically pay heavily for Internet advertising have decreased their marketing expenses. That, in turn, has cut demand and lowered prices for ad inventory Netflix might have otherwise paid a premium for.) The drop off in acquisition costs also probably owes to strategy changes at Blockbuster (BBI) that have led to less near-term competition."

Has anyone seen other data points suggesting falling CPMs in the online ad market? Given Google's better-than-expected results, more evidence is needed to substantiate this claim.

Blockbuster Closing 282 Stores; Netflix Cuts Price of 2-DVD Plan

This is exactly the sort of price war you don't want to be caught in as an investor. There's no way these two stocks are longs; the only question is whether the price war will be so bad that you want to short them both.

It will be interesting to hear what Netflix has to say on its conference call.