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Netflix is 'the Mercedes-Benz, it's the Rolex' of streaming: analyst

McKenzie DeGroot
Segment Producer

The launches of AppleTV+ (AAPL) and Disney+ (DIS) are right around the corner. All eyes are on Netflix (NFLX), and how the streaming giant will react to the pressure of added competition.

“It’s the premier, it’s the Mercedes-Benz, it’s the Rolex of the streaming video service,” Dan Morgan, the vice president of Synovus Trust, told YFi AM.

“Netflix could target themselves as the premier service with the new shows, with the content, and that way they could be able to kind of out-do some of these lower-price services,” he continued.

The Netflix logo is seen on a phone in this photo illustration in Washington, DC, on July 10, 2019. (Photo by Alastair Pike / AFP) (Photo credit should read ALASTAIR PIKE/AFP/Getty Images)

AppleTV+ will be released on Nov. 1, shocking consumers with its low price of $4.99 a month. Disney+ will be released a few days later on Nov.12, with a cost of $6.99 a month. Both companies have placed their price points far below Netflix’s $9-$16 a month range.

Morgan says this may have the biggest impact on Netflix internationally. With people having lower incomes, users may be “more attracted to these lower priced streaming services,” he says.

Morgan says he isn’t too concerned with competition in the United States, as “people might have a Netflix and a Disney and maybe one more service.”

Earnings Preview

Netflix is reporting third quarter earnings after the bell on Wednesday, in its final report before the launch of its competitors. The streaming giant saw disappointing subscriber growth for its second quarter, raising concerns over the amount of money the platform was shelling out for original content.

“The international side is the story,” Morgan adds. “It will be interesting to see if Disney can get a shoe in and start to eat away at the growth that we’re seeing on the international front.”

McKenzie DeGroot is a producer at Yahoo Finance. Follow her on Twitter: @degrootmckenzie

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