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Netflix and Chill: Analyst Says SVOD Wins Video Wars

Sometimes controversial and always influential Sanford Bernstein media analyst Todd Juenger initiated coverage on Netflix Thursday with an “outperform” rating, adding that the subscription video on demand pioneer is the anchor in what will be the dominant model for video entertainment delivery.

Juenger has been a harsh critic of linear cable networks – he was the first to identify Viacom’s ratings woes and how short term SVOD deals led to long-term subscriber erosion. And with his note to clients on Thursday, he admitted that no matter what position he took on Netflix, he was in danger of alienating half his client base. But, he added that the evidence is too great. SVOD is quickly becoming the dominant vehicle for video delivery, offering low prices, scale, ease of use and flexibility. And Netflix, with 100 million global subscribers and counting, an $8 billion content budget and strong partnerships with distributors that have embedded the service in smartphone, set-top boxes and other equipment, is the anchor.

Related: Netflix Growth Projections in Europe 'Way Too Low’

“A wise investor once remarked to us: ‘If Jesus were a stock, he'd be Netflix. You either believe or you don't,’” Juenger wrote. “We think that analogy perfectly captures investor attitudes on this stock.”

Juenger isn't the first analyst to predict the demise of linear TV in favor of SVOD -- BTIG media analyst Rich Greenfield has been saying it for years.

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