The end of 2017 saw Disney attempt to take on industry behemoth Netflix with a proposed $52 billion takeover of 21 Century Fox. As Citi points out however, that figure is just a third of the huge $252 billion cash stockpile Apple now holds overseas and is yet to bring back to the US. But a pair of analysts from financial giant Citi think there's a good chance Netflix itself may soon become part of an acquisition that eclipses the Disney/Fox deal: they believe there's a 40 percent likelihood that Apple will acquire the streaming service.
Before Disney acquired Fox's studio and TV platforms, Citi predicted there was a 20-30 per cent chance Apple would acquire it.
It's estimated that Apple would only need a third of that to buy Netflix. Quite obviously, Apple stands to gain a lot more from acquiring Netflix than any of the three video game companies. However, "he points that there are strategic reasons for Apple to buy Netflix when you look at the financials, it would take a long time for the bet to pay off if it ever does".
If Citi's visionaries get this one right, it's the kind of deal that would be positively seismic. By noon Tuesday, Netflix shares were priced at $200.65. So how much is Netflix worth?
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One of the key reasons, as he argued is that Apple is now is seeing slower growth than Netflix. Meanwhile, Apple was up by 1.28 percent on Tuesday. Apple is also developing a new space opera from Battlestar Galactica's Ronald D. Moore. By purchasing Netflix, Apple could jump start its streaming efforts in a really major way. That money helped Apple lock down an order for a reboot of the Steven Spielberg executive-produced Amazing Stories, as well as a coveted scripted drama about morning TV shows set to star Jennifer Aniston and Reese Witherspoon. However, while Apple has tried to lure streaming customers with original content, viewers still flock to other services, like Netflix, Hulu and Amazon Prime Video.
Apple has more free cash than it knows what to do with, and buying Netflix would be a way for it to offload more than $250 billion in newly-repatriated earnings it's been holding overseas.
However, this prediction should come with a huge grain of salt: namely, that this is all on the words of analysts who, as Forbes says, "have nothing to lose".