Netflix Has Over $20 Billion in Debt

Netflix is undoubtedly the king of streams if such title even exists. Netflix has been spending money creating original shows as while as getting the license to stream some of the best shows and movies. Just a couple of months ago they raised the standard subscription price to $9.99 releasing a statement that they are trying to create more original content and it is costly. This was their way of justifying the price hike to the subscribers.

nflx debt_0.jpg

It was just announced that Netflix has hit 104 million subscribers worldwide. If all subscribers are paying $9.99 or equal value in what ever currency, Netflix rakes in a little over $1 billion dollars a month. I was taught in business that a little debt is not a bad thing, but this seems very imbalanced. I believe at some point they will have to trim the fat and/or stop producing a lot of the original shows.

Netflix is really gambling on their ability to gain new subscribers. Maybe they have plans to increase the cost of the service to $14.99 like HBO Now.

I would love to see a $5.99 option that has limited commercials. Can you imagine the kind of revenue they get from ads? A cheaper plan with also significantly increase that subscriber number.






Categories: Money, TV/Movies

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