Amazon to Buy Netflix?
After the uproar created by previous Netflix announcements, this is right in line with what I had said might be the–seemingly ludicrous–reasoning behind the creation of a second business unit. From the customer perspective, it sucks, but from a business perspective, it would have been precisely what was necessary. Obviously, this is pure speculation on everyone’s part, but time will tell whether or not we (and Reed Hastings) were off our rockers…
“We therefore concluded that there was a rational explanation for the apparently boneheaded moves by Netflix – it became clear to us that Amazon is buying the streaming business,” Pachter wrote. “…AMZN can buy without sales tax concerns (and) the split-up allows a federal income tax-free sale (stock-for-stock).”
He may be on to something
He may be on to something there. That’s genius. It even lowered the stock price so Amazon doesn’t need to shell out as much cash.