Netflix 4Q14 Earnings Call Notes

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This post is part of a series of posts called “Company Notes.” These posts contain quotes and exhibits from earnings calls, conference presentations, analyst days and SEC filings. Full transcripts can be found at Seeking Alpha

Internet video in every home

“if you step back and you say is Internet video going to be in every home in America in 10 years, that’s a pretty clear yes. So, tons of potential there and we’re very excited about just continuing to improve our service.”

Pushing for global content rights

“we’ve been pushing on that dimension to be able to get the global rights where we don’t have to go country by country across 200 countries but instead can provide to produce our upfront money, guaranteed money and get great access.

Mexico has 65m broadband households

“It’s a market with about 65 million broadband households. So if you take that 5 million number that we talked about and 65 million in terms of addressable, we think we got a lot of room for growth in the market.

Original content has had global appeal

“this has been so encouraging how truly global these brands have been. So when we set out our original program for the beginning, obviously our markets were pretty limited and we were thinking about them mostly as U.S. shows and they would travel like other U.S. shows have. And we’ve been really enthused to see particular in our Western European launches shows like Orange is the New Black and House of Cards, even in later seasons performing tremendous for us because people hadn’t got around to seeing them yet and we could get the brand out there and push it out there.

Learned our lesson on giving full year guidance

“we’ve learned our lessons on giving full year guidance on numbers so we tend not to do tha

Could drive more revenue by pricing for Ultra HD

“if you look ahead two years, four years from now many of the TV’s sold at Best Buy will be Ultra HD and lots of our content will be Ultra HD and it’s a natural match…it’s seems fair and natural for them that just like you pay for difference between standard def and HD that there is a difference between HD and Ultra HD. So that’s the way that we got incremental revenue without making any changes ourselves by just letting the tide come to us.

Original content is very competitive

“On the original side it’s a very competitive market and we’re fortunately positioned ourselves as kind of a premier destination for the biggest and best projects. We don’t say yes to all of them and we see them show up at other places but we do think that we’re the first or second go-to for most of the projects that we’re looking for.

If HBO tries to match NFLX its disruptive to them

“ To the degree that they go really aggressive and match Netflix’s price for HBO, then it’s extremely disruptive to their current ecosystem since the prices are higher than that.

Sling TV is just a start

“It’s a great start. Charlie Ergen has been a great entrepreneur and I think he sees the future that its internet centric and it may not be the perfect offering today, but it’s got $20 a month very attractive pricing and he’s been an incredible entrepreneur in terms of starting with something small like early DISH and building it in to the internet and DVD, so it’s great for him and add some competition in that market, but I don’t think it materially changes the desire to have Netflix with our unique and exclusive shows.

30-40% of viewing on personal devices

“We’ve said personal devices PC, tablet phone that varies by market some sort of 30%-40% of viewing and TV based viewing being the large green share doing being the majority of it. No particular change in those metrics.

Consumers are careful about using mobile devices in non-wifi because of caps

“So we see a lot of tablet and smartphone usage but almost always on WiFi networks and then they’re careful about how they use the cellular networks because of the caps and the fear of [overages].

Internet TV is getting validated

“So the fundamental thesis is getting validated, that’s great. And for us it’s both on competition and its more consumers coming in the market, speeding up because Internet TV is becoming so mainstream.

The internet as a utility is great for NFLX

“what’s been great for Netflix is the general idea of the Internet as a utility open to all not for discriminatory use, as it really take whole…we appear to be on the edge of an acting Title II and generally codifying the idea that at least in the U.S. the Internet is a utility for broad social good and wide open access. And that over time if it happens will significantly insulate us from any accelerating tax for interconnections.

Disney content creates synergy

“we’re excited about the Pay 1 opportunity with Disney because those movies are not just movies. They’re amazing family content that get flexed over and over again forms great loyalty with our subscribers and it’s a real trust brand for parents as well.