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Netflix Easter Egg? Sale Rumors Swirl

Posted by Sheila Shayon on December 13, 2011 04:10 PM

“Netflix will be sold by Easter,” Porter Bibb, managing partner at Mediatech Capital Partners, told Bloomberg News. "I am hearing very serious rumblings from inside Verizon that they are very serious about either Netflix or something similar."

A deal with Verizon would put sorely needed cash in Netflix’s pocket as international expansion is on hold while the company staggers to regain profitability, reeling from a disastrous 2011, which saw a number of mishaps for the video rental/streaming brand.

After hiking subscription rates 60% in July, a customer revolt led to an ill-fated attempt at restructuring their DVD and streaming plans with the planned (then abandoned) launch of Qwikster, which sent nearly one million subscribers into exile; so they un-restructured but still lost close to 800,000 customers.

“With Verizon, [Netflix CEO Reed] Hastings would get a lot broader distribution and global reach,” said a Hollywood insider to the New York Post. “It’s all about global expansion, and they have deep pockets to effectuate that.”

Other potential suitors possibly poised to snatch the cash-challenged but content-rich streaming service include Microsoft, Amazon and Apple. The only one not (apparently) interested is Time Warner, which is promoting a rival in HBO's HBO Go streaming service.

Amazon’s service charges customers a $79 annual fee for free shipping from its e-commerce site; Microsoft already offers access to Netflix's streaming service through its Xbox 360 video game console; and Apple, is widely rumored to be preparing an Internet-enabled TV as early as 2012.

Verizon’s service would stream video over high-speed Internet connections in markets not served by FiOS and reportedly have “more than 3,000 titles at a price of $5 to $10 per month. In contrast, Netflix charges $8 monthly for access to over 30,000 programs.”

If Verizon builds its own service, it may partner with DVD-rental vendor Redbox, available now via in-store kiosks with daily fees of $1.20, and eager to enter the Internet streaming arena as reported by TechCrunch last week.

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