Netflix to be mismanaged by Best Buy?  Buy out rumors abound

Posted May 18, 2008 at 12:46 PM by JG Mason

Section: Video, Content, DVD Players/DVRs, HDTV, Video Providers

Say it isn’t so.  Please.  Rumors are circulating that Best Buy is considering buying out Netflix according to AlleyInsider.  Feeding into the rumor pushed the stock up 6% in Friday trading.  Interesting.

It is easy to see why Best Buy might want to get a hold of the Netflix business: it is well position (or at least positioned) to make a play for the next advancement in the home entertainment.  Most see direct downloading via the internet as the next wave and Netflix is in the mix with some help from LG.

So why Best Buy?  Best Buy could sell content at the point consumers purchase a DVD player.  Best Buy could reduce customer acquisition costs for Netflix while improving their market position by selling a complete package.  It would be an impressive move, potentially.

But at what cost to Netflix?  Surely the ace customer service one gets at Best Buy (speaking from personal experience only here) would drag down the fun, red enveloped company I’ve come to enjoy and think of as “fun”.  Netflix has a good thing going, it would be a shame for the new big blue to bring them down.

What do you think?  Could Best Buy bring anything good to Netflix?

Read [AlleyInsider]