Streaming Giant Netflix Surpasses Entertainment Behemoth Disney’s Market Value

The prediction of analysts at GBH Insights for Netflix’s share price is $500.

This online streaming giant, is taking on all comers in its race toward the top spot in the entertainment industry’s Big Boys Club

Bumping up from 400 U.S. dollars previously, surpassing the 490 U.S. dollars that analysts at Goldman Sachs assigned last week and representing a near 30 percent premium to Netflix’s closing price on Monday, the online streaming giant, is taking on all comers in its race toward the top spot in the entertainment industry’s Big Boys Club.

The online service as its known now, was first formed in 1997 by Reed Hastings and Marc Randolph. But the firm was not launched until 2007 and did not start international operations till 2010. Since then it has expanded significantly.

“Most entrepreneurial ideas will sound crazy, stupid, and uneconomic, and then they’ll turn out to be right,” said CEO Hastings.

Netflix has managed to surpass the likes of Time Warner ($85 billion), CBS ($20 billion), and Viacom ($20 billion) in terms of market capitalization in a short period of ten years powered by the astronomical growth in its subscriber number which is reflective of the huge change that the global entertainment industry has undergone in that period.

And after the company posted better-than-expected subscriber numbers in the past quarter, the net worth of the company has picked up significantly this week.

And compared to the current $172 billion market value, the market value of Netflix is expected to be around $217.35 billion according to GBH Insights’ prediction.

This helped the market cap of the company to go past that of telecom-cable giant, Comcast ($147 billion), parent company to NBCUniversal ($30 billion), including Dreamworks, Universal Studios, MSNBC and others.

What is most astonishing is that Netflix upended the reign of Disney as amongst the most valuable companies in the entertainment industry.

“Netflix shook it up, brought this whole new generation of people who said, ‘I watch things when I want to watch, how I want to watch, where I want to watch, and that’s something that no one’s going to ever forget,” said Mike Colter, Marvel’s Luke Cage. “This has changed the game completely, and I think it’s the tip of the iceberg.”

Netflix is now more valuable as a company compared to the 95-year-old behemoth.

It was not easy to beat Disney which has the richest IP assets in Hollywood and has a net worth of about $150 to $160 billion.

But Disney’s clout and ability to adapt should not be discounted at this stage. Disney is starting its own online streaming service and with the huge library of quality films and programming, it is serious about competing in the over-the-top market.

Disney also is the owner of 30 percent of Hulu – the closest rival of Netflix. Further, the company would be able to use its Star Wars and Marvel titles for exclusive streaming on its own site after the expiry of a multi-year contract with Netflix.

“Stone Age, Bronze Age, Iron Age. We define entire epochs of humanity by the technology they use,” said Netflix CEO Hastings, “There is a revolution happening and within two years I think that Wi-Fi and Netflix will be built into all televisions.

(Adapted from Xinhuanet.com)

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