Analysts say there's a 40% chance Apple will buy Netflix

Analysts say there's a 40% chance Apple will buy Netflix

Analysts say there's a 40% chance Apple will buy Netflix

Now that Disney's taken over 21st Century Fox, anything seems possible in the world of entertainment mega-mergers.

It's not exactly a secret that Apple has a lot of cash laying around, and thanks to the GOP's new tax plan, we may see it put some of that money to use.

With Donald Trump's aim to cut corporate taxes, alongside a one-time chance for companies to bring cash back to the United States from overseas without accruing a large tax bill, Apple will have a much bigger budget to buy new companies.

Before Disney acquired Fox's studio and TV platforms, Citi predicted there was a 20-30 per cent chance Apple would acquire it.

Apart from Netflix, the analysts say there is a smaller chance (10%) of Apple looking at acquiring video game companies such as Activision, Electronic Arts, and Take-Two. For now, it's the kind of talk that's only happening among analysts - and not between Apple and Netflix (so far as we know). Why would they spend $75 billion to buy Netflix?

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If Citi's visionaries get this one right, it's the kind of deal that would be positively seismic.

"Netflix is miles ahead in terms of programming hours, original content quality and time spent, and we don't expect this to change". It fluctuates, since it's pegged to Netflix's stock price, but the company's market value pushed past $80 billion in 2017, and is expected to scrape the $100 billion mark if its stock continues to rise.

One of the key reasons, as he argued is that Apple is now is seeing slower growth than Netflix. Forbes reporter Karl Kaufman argues that there is good reason to doubt this analyst prediction, writing, "Apple has already committed $1 billion towards creating new shows and their largest acquisition was buying Beats for $3 billion in 2014".

A Netflix acquisition would be a big win for Apple who has struggled for years to nab a successful TV or movie holding. The company is also working on its first scripted series with Jennifer Aniston and Reese Witherspoon. While Apple does offer a vast catalogue of video and music content on iTunes, there is no denying the fact that streaming services such as Netflix are much more popular.

Apple is said to have as much as $250 billion dollars at its disposal, and Suva and Merchant figure that it would need only a third of that hoard to buy up Netflix.

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