Netflix: Streaming To Overtake Mail Service This Year
While continuing to trumpet its subscription video-on-demand streaming service -- and invest billions in content deals for it -- Netflix indicated on Tuesday that its movies-by-mail service has continued to account for its principal source of profit. At least, until now. As reported by Home Media magazine, in an SEC filing on Tuesday, the mail service accounted for $539 million in profit in 2012, while the streaming service accounted for $350 million. Netflix, however, said that it expects the streaming service to overtake disc rentals during the current quarter, largely due to the fact that people request more DVD and Blu-ray discs during the quarter and mailing them out will cost a penny more each way. Netflix's disclosure was incorporated in a new $500-million debt offering to be used to refinance existing debt at a lower rate and pay for original content for the streaming service. On Friday, Netflix launches its highly anticipated drama House of Cards, starring Kevin Spacey and Robin Wright, and directed in part by David Fincher. All 13 episodes of the series are due to be released simultaneously.