Nomura: Netflix, Amazon 'Best Positioned' In The Streaming Wars

Netflix Inc. NFLX and Amazon.com Inc. AMZN are the best-positioned companies to take advantage of the movement toward streaming entertainment, Nomura Instinet said in a new look at the industry.

While Netflix, the pioneering early giant in the space, and Amazon look best among the companies providing streaming services, Apple Inc. AAPL may have the "most in question" position in the new business, Nomura analyst Mark Kelley said, citing the high price, and relatively small library for the computing giant's Apple+ streaming service.

To succeed, streaming services need a mix of "splashy, new frontline content," to lure customers in to try out the service, and then also need a "long-tail library to keep users engaged after consuming the initial hits," Kelley wrote in a note. Netflix and Amazon are the two companies that have both.

Peacock, HBO Have Good Libraries

The new Peacock streaming service from Comcast Corporation's CMCSA NBC, which will be unveiled this week and start streaming in April, will have a strong library, with a large catalog of TV and movie hits, including "The Office." AT&T Inc.'s T HBO also has decades of programming from its long-lasting cable network that give it a strong, diverse library, Kelley said.

Apple+ and Walt Disney Co's DIS Disney+ streaming services, on the other hand, have had the flashy reel-them-in content.

Disney, for example, has gotten headlines and social media traction from Baby Yoda in his new "Mandalorian" show, while Apple+ made a splash last year with some star-studded new exclusive shows like "The Morning Show," with Jennifer Aniston and Reese Witherspoon. But the depth of both networks' offerings beyond the headline-grabbers may not be as strong as that of Netflix and Amazon.

Bottom line? "A positive for NFLX, a path for HBO Max and Peacock, lukewarm for AAPL," Kelley wrote.

Netflix and Apple shares were both up slightly on Tuesday, with Netflix trading at $341.24 and Apple at $314.09, while Amazon was trading at $1,862.54, slightly off from its opening price.

AT&T and Disney were both also down fractionally from the open, with AT&T at $37.84 and Disney at $144.58 at publication time. Comcast was up slightly at $46.24.

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