Amazon.com, Inc. (AMZN): Is Netflix, Inc. (NFLX) Destined for Greatness?

Fool contributor Robert Hanley notes that DVD-rental competitor Redbox, a subsidiary of Outerwall Inc (NASDAQ:OUTR), recently entered into a partnership with Verizon Communications to launch online streaming service Redbox Instant, which offers unlimited streaming of movies and four free monthly DVD rentals at a lower monthly subscription fee than Netflix, which is already pretty darn cheap when you think about it. This might be concerning if Verizon throws its marketing and financial muscle behind Outerwall Inc (NASDAQ:OUTR), but until that happens, Redbox Instant is likely to remain in a distant third place in the subscription-streaming war — fourth, if you count Hulu.

Netflix’s unique content strategy of providing full seasons of original programs to its subscribers all at once may also come under threat. Time Warner Inc (NYSE:TWX)‘s HBO app, HBOGO, is currently quite restrictive compared to Netflix, and a proper push for this cable alternative would undermine Netflix’s dominance of online original programming. Is that likely? Not in the immediate future, but if cable providers feel threatened, they might start looking more seriously at providing online-only options.

Netflix, thus far, remains far in the lead in terms of content breadth and depth. The company recently signed a multi-year content agreement with the Weinstein Company, which is expected to begin in 2016. Lions Gate Entertainment Corp. (USA) (NYSE:LGF) also signed an agreement that allows Netflix to show any of The Hunger Games episodes on a pay-per-view format, and Lions Gate Entertainment Corp. (USA) (NYSE:LGF)’s deal to produce future seasons of Orange Is the New Black for Netflix is all but certain to continue given the new show’s popularity and critical acclaim.

Putting the pieces together
Today, Netflix has few of the qualities that make up a great stock, but no stock is truly perfect. Digging deeper can help you uncover the answers you need to make a great buy — or to stay away from a stock that’s going nowhere.

The article Is Netflix Destined for Greatness? originally appeared on Fool.com and is written by Alex Planes.

Fool contributor Alex Planes has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Amazon.com and Netflix.

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