Netflix Slides, Blames Olympics

Welcome to the broadband and cable news roundup, Hump Day edition.

  • Netflix Inc. (Nasdaq: NFLX) shares dropped more than 15 percent in after-hours trading Tuesday after the company warned that it might not hit its year-end subscriber target of adding 7 million new U.S. streaming customers. The company told investors (PDF) that it's fearful that the Olympics, which are sizing up to be a watershed event for the traditional pay-TV industry's TV Everywhere concept, is "likely to have a negative impact" on Netflix usage and its ability to achieve its target of adding 1 million to 1.8 million new subs during the third quarter. If it doesn't hit the high end of that range during the period, it will be "challenging" for Netflix to hit its year-end target, the company said. Netflix added 530,000 U.S. streaming customers in the second quarter, extending its total to 23.9 million. (See Access Doubts Dent NBCU's Olympics Ambitions .)

  • The number of Virgin Media Inc. (Nasdaq: VMED) cable customers to sign up for the MSO's TiVo Inc. (Nasdaq: TIVO)-powered TV service is on the verge of breaching the 1 million mark less than a year after the operator launched the product, reports The Guardian. Virgin Media added 261,700 TiVo customers in the second quarter, extending its total to 938,800. But the popularity of the option couldn't help the operator avoid losing 14,700 video subs in a quarter that's typically marred by "seasonality," as students leave their temporary accommodation for the summer and disconnect service.

  • Harmonic Inc. (Nasdaq: HLIT) made some significant executive changes this week, naming Peter Alexander to SVP and chief marketing officer, and Krishnan Padmanabhan to SVP of video products. Alexander, a former Cisco Systems Inc. (Nasdaq: CSCO) exec, and Padmanabhan, late of NetApp Inc. (Nasdaq: NTAP), both report to President and CEO Patrick Harshman. Harmonic also promoted Nimrod Ben-Natan to head up the company's edge and access business, where he'll oversee R&D in the product category, which includes the vendor's emerging Converged Cable Access Platform (CCAP) initiative. Harmonic also appointed Mitzi Reaugh, SVP of strategy and business development at Miramax, to its board.

  • On the financial front, Harmonic posted second-quarter net income of US$17,000 on revenues of $132.6 million, down slightly from the $134 million posted in the year-ago quarter and less than the $135 million expected by Wall Street. Harmonic is forecasting revenues in the range of $130 million to $140 million in the third quarter.

  • Joan Gillman, an executive vice president at Time Warner Cable Inc. (NYSE: TWC) and president of the operator's media division, has joined the board of content delivery network (CDN) specialist SeaWell Networks Inc. .

    — Jeff Baumgartner, Site Editor, Light Reading Cable

  • digits 12/5/2012 | 5:26:35 PM
    re: Netflix Slides, Blames Olympics

    "Nimrod, meet Mitzi!"

    "Why, thank you Harshman!"

    Is there a script in this? Or did it already run on Star Trek?

    Jeff Baumgartner 12/5/2012 | 5:26:34 PM
    re: Netflix Slides, Blames Olympics

    The other interesting thing to come out of Netflix earnings was Reed Hastings' hypothetical comment that Netflix could someday, maybe partner with HBO.   Hastings will have to keep on hoping, as HBO pretty much squashed that notion, telling Reuters that it is "not in discussions and have no plans to work with Netflix."  For now, HBO is content to keep working with its pay-TV partners and keeping Netflix at more than arm's length.  Even if HBO allowed it, recall that it would probably cause Netflix's streaming subscription costs to go through the roof.  JB



    shygye75 12/5/2012 | 5:26:34 PM
    re: Netflix Slides, Blames Olympics

    Netflix -- the industry leader in unintentional comedy.

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