Netflix shares are at an all-time high after the announcement it will be carried by major cable TV provider Virgin Media in the U.K. in a first-of-its-kind deal — not bad for a company some figured for dead a couple of years ago after a couple of big missteps.
What’s the significance of the deal, and will other cable providers eventually follow? Mark May of Citigroup, according to Barron’s: “This is the first time that we’re aware that Netflix has been integrated directly into a pay-TV offering.”
TiVo, the Silicon Valley-based maker of digital video recorders, told Bloomberg that it means a TiVo user who searches for, say, Kevin Spacey, would see search results that include Netflix TV shows and movies that feature the actor. “It’s a big deal, especially if it helps open the gates for operators globally to integrate and stream over-the-top content,” TiVo spokesman Steve Wymer told Bloomberg.
It’s the first example of CEO Reed Hastings’ stated vision — which we’ve written about — of Netflix as an app, and as a competitor to original content providers such as HBO.
“It’s a huge win for Netflix. Cable sees Netflix as a possible problem for them, an alternative to cable. This is an acknowledgement by Virgin that its customers want that type of service as well,” Michael Pachter of Wedbush Securities said, also according to Bloomberg.
Shares of Los Gatos-based Netflix were up more than 5 percent to about $310, an all-time trading high, as of this post. They are up 238 percent so far this year. The company has been collecting milestones and firsts lately. As we wrote last month, Netflix’s own series, “House of Cards,” scored top Emmy nominations.
Photo: Netflix headquarters in Los Gatos (Getty Images)