whether it's netflix/comcast, netflix/whomever.etflix may not be all that average representative of your content provider. so i'm concerned that regulation is going to be spawned through a prism that might be a false one. i also want to point out that netflix has certain counterstrategies in its pocket. if it wanted to, you know, for example if an isp gave it a hard time, they could impose an isp surcharge for customers of that isp to discoarnlg people to switch to a rival isp. they're in the driver's seat, and that's just another reason why we should take, i think, a go-slow approach to adding on another layer of regulation. >> i'm going to give anna maria the last word. >> just to answer gerry's question, there is a blog post on the fcc's blog that was put out friday in response to the chairman's blog by brett glass who runs a wireless isp in laramie, wyoming, and it is an impassioned plea to not regulate the internet explaining from a very small isp's perspective what that would mean to his ability to gain investment. so that is

netflix is a newer company.are brave enough to do a deal with comcast and have favorite access, but also say that they do not want these in the future. >> i would put netflix in the savvy bucket. they played this game very well. when they decided to make a real push in hollywood, they did it the hollywood way. they were very friendly with the various content creators. you have seen their willingness to pay a lot of money. they did not treat themselves as outsiders. netflix is speaking out in part because they're savvy and they cut a deal with comcast. they are hedged in this story. this is about the next netflix. the companies we have not explored that could potentially change the tv or media viewing experience. it could get started up and silicon valley or here in los angeles. but then it cannot afford to be in this game. you have to pay to play. >> edmund, you say that this deal passes. what happens in reality? >> with companies like netflix and other silicon valley companies that have made statements recently

providers like netflix. could provide even leverage to charge arbitrary interconnection tolls for access to their customers. for this reason, netflix opposes this merger. why go out on a limb like that? >> that is a good point. but let's put this in better perspective. as john points out -- as jon points out, disney and the others have said it's going to be fine, whereas you have company like netflix complaining about the deal. but if you take a step back, disney, viacom, 20th century fox , they get paid by comcast, who picks up their content. whereas netflix pays comcast for these interconnection fees. of course netflix is going to complain about it. and companies like disney and cbs and foxx will be quieter since they are being paid by these guys. it is important to understand the context and why publicly one --e has said one thing and one side has said one thing and the other side is complaining. but netflix brings up a good point. when you have a company that has 30% of connections to all u.s. subscriber

if i am a customer of comcast and i want to watch a netflix video and netflix is willing to show it to me, the netflix video goes through the comcast network, peering, no peering, doesn't matter. is the end systems that generate. now there are cases where peering matters but we need to peer a little more closely in terms of how much traffic comcast would have to carry. it matsers if end systems react to congestion in the network. they end the peering path and transit path, one of them is much more congested than the other and that actually seems to be what is going on here, right? what seems to be happening, we think, is that there was congestion in the transit links but the direct peer did not have that congestion. why does that matter? some application it is wouldn't. so happens for netflix streaming if you're watching a netflix video and you're watching high-definition and congestion comes along, that application will automatically revert to low definition. so it will back off because of that, congestion reduces the load. so, seems by both accounts there was congestion. the interest

let me use an example of netflix. netflix is our largest customer. we are their primary carrier of internet traffic. netflix buys that connectivity because we deliver the highest quality at the lowest price. we have dozens of competitors. we offer the lowest price and the highest quality. netflix wanted to do business with us. they continue to be our largest customer, but there was a problem. we cannot deliver all of the traffic that netflix was delivering to comcast customers. when we deliver the traffic, the ports for connections between our network and comcast he came full. patch became full. we went back to comcast and between our network and comcast became full. we went back to comcast and said, can you upgrade? comcast refused. they not only refused cogent, they refused every other major backbone. in doing so, forced netflix into a corner. they forced netflix to have to go and directly enter into a contract with comcast, paying a higher price for a less robust product. that is not a free market. that is an abuse of market power. are two parties

recently netflix signed an agreement with comcast that would allow netflix to directly access comcast customers rather than paying companies to carry traffic between its servers and comcast customers. on the one hand this could be seen as a simple, straightforward reddish transaction. paying comcast to connect directly instead of sending traffic to other companies may simply have been categorized as a smart business decision, but netflix raises its concern, asserting it was forced to pay comcast for reliable delivery to comcast customers. the netflix ceo reed hastings and david wells explained that the internet is a long-term threat for profit for themselves and cost for everyone else. the comcast time warner merger is approved, the combined company would produce even more anti-competitive leverage to charge interconnection tolls for access to their customers. the real question is not what affects the merger may have on netflix per se but on the next netflix that might emerge as an alternative to comcast video distribution business. would a combined entity be able to use its potential

the netflix deal, i heard dealthe netflix to comcast does not touch the internet. it is a private line. it is from netflix network to the comcast network. in terms of paid prioritization, will people be able to do these side deals where they do direct lines bypassing the public internet? that is probably 89 or 90. when chairman wheeler was walking out, someone from the press asked about that question. he said it does not apply to the netflix deal. >> i agree with that. let me explain. these open internet rules are aimed at governing the connection between internet service providers and consumers. when we talk in that context about paid prioritization, what we're saying is that at&t should not be allowed to cut a deal with netflix. it will speed up the delivery of netflix traffic. that is compared to other services. we will have a debate over whether such an arrangement might be reasonable. the interconnection between networks and netflix directly comcast and between comcast with an intermediary is something that the sec has set it outside of these rules. it is a de

it is exactly what netflix is doing. it is building up a subscriber base that generates money and they can use to finance content. hbo has content but you cannot get it unless you have a cable subscription. so in order to get hbo, i have to call the comcast or cable guy and i have to subscribe to a bunch of other channels i might not want. the great thing about netflix is you don't have to do any of that and it is cheaper. hbo is $10-$15 and netflix is $8-$12. but the most important issue is it is unbundled. so it is going to be in the interesting to watch the rising pressure on hbo over the next couple years as they grapple with in order to compete with netflix and google and apple and microsoft and amazon who might be producing content as well, what will hbo do? will they put pressure on the cable networks to allow them to sell their channel unbundled? watching how that plays out is going to be really, really fascinating because i think that if the cable networks resist and refuse to let hbo go its own way, i think you

we actually partnered with netflix. you can search for content.ill search everything including netflix. watch know,to lying. but you do not have to leave our environment necessarily. >> is it popular this way? >> it is working fine. we may launch our own services we will really differently in each market. it is important for all of us to be willing to embrace that form of it into steel the best of it. be just as well. that is key. >> we spoke a couple of things that consumers want. authentication is one of them. it also hires faster speeds. they want to have a seamless interface. from your experience being in touch with consumers, ultimately, what is the holy grail? that isthe holy grail really going to make a difference? >> i can tell you what it is not. we still have not come up with the proper formula for consumer care. us.an, it is plaguing we are spending more money. we are developing more systems. expectations are rising, too. we might have satisfied them on five years ago. us.they are expecting they are still love their own what they expect

in the case of netflix, subscribers.learly, they're looking for people who consistently, month after month, pay for their service. that is why they are increasing pricing and launching in these european nations. they really look for markets where they can consistently find people who will pay as opposed to markets where piracy is an issue. on the amazon site, you have the content costs rising. spending as much as netflix every year and now, but there have been some estimates that there hbo contract might be in the neighborhood of $300 million a year with an endgame being a little bit different than netflix in that they want to get people to buy more stuff from amazon. >> what do you think of a company like netflix? 48 million subscribers now yet running up against potential net neutrality issues. they take up 34% of internet traffic at peak time. >> it's an amazing service. we are large holders of that company in our hedge fund. where moving to a world the physical pipes are commoditized and valueless. and companies like

i mean, it's exactly what netflix is doing with its business model. it's trying to build up a subscriber way -- base that generates money that it can then use to kind of finance original lal content and so what's going to be really interesting to watch right now, hbo has this incredible content. but you can't get it unless you have a cable subscription. so in order for me to get hbo, i've got to call the comcast guy, or i've got to call the cable guy to come this, and i have to subscribe to a whole bunch of other channels that i might not want. the great thing about netflix is that you don't have to do any of that. and it's a little bit, and it's a little bit cheaper. i think hbo is $10-$15 a month, and i think netflix is $8-$12 a month if my memory serves. but the most important issue here is that it's unbundled. and so what's going to be really interesting to watch is the pressure on hbo, is to watch the rising pressure on hbo over the next couple of years as they try to grapple with whether or not in order to compete with netflix and, for that matt

netflix is going to be coming to the continent. >> it is extraordinary growth for netflix. amazing they have more subscribers than hbo. hbo is teaming up with amazon. is it going to be "game of thrones" versus " house of cards"? eventually, maybe you could have the more current shows compete each -- compete with each other. then, it is the showdown between amazon and netflix. have both. there is note you regulation against having both netflix and amazon. >> hans nichols. >> i have discovered something amazing. one of thes like actresses on "orange is the new black." i believe she is a transgender character, so i do not love the comparison. everybody in the u.s. already knows this. it is a terrific show. not as good as "house of cards." "the good wife." >> i am so glad. cheaper razor blades online. the startup is just bought a german factory to help its cause. david tweed caught up with the co-fan -- cofounder. >> in the small town in the former east germany, new york-based startup is making waves. >> i am the cofounder and co-ceo of harry's. it is a grooming brand. we sell

no one made netflix did it. netflix is saving money. i really resist the idea that someone net neutrality had anything to do with that or some of those in the coercion of the. think about it in comments as. netflix is in an ideal position with merger proceedings pending. if you want to use the regulatory process to avoid a deal like that it had enormous opportunity. they voluntarily went into a commercial of richmond because it was such a good deal for them. >> putting on my engine in hat for a moment, this is a devastation of an important point about the technical architecture of the internet. when you talk to the technologists the images will take that the internet is not neutral. it isn't a concept that has a technological me. one of the reasons for it is the physical design of the network where you connect, interconnect has a great deal influence over how effectively different sources of traffic will be handled by the internet. i want to highlight that it's nothing new for netflix or for anyone to use a private connection to connect

first off what's in your netflix cue?ck" and carlos, a mini series right now. >> how do you stream? what devices do you use to stream? >> i've got every device on the planet because i'm always trying to test it, my apple tv, row cu, chrome cast. >> favorite app on your smartphone? >> strava tracks you when running. >> interesting. >> what do you consider to be the biggest threat to netflix at this stage? >> biggest threat is we get too comfortable. things are going well so we got to keep pushing and find new things. >> the word you use most often in your language these days, spectrum neutrality. >> no, no, no. none of those. we use content and shows and, you know, cultural change. >> i have to ask, with all this talk about global expansion, the cost of all this original content and license content, would you ever consider advertising? >> i don't think so. like hbo, which has never had adds we've never had ads. it's a part of our ad market. hulu does that, youtube does that, they have good shows. just a different business

coming up, netflix makes a big push. tell you which countries are getting an online video service. ♪ >> welcome back to "bloomberg west." i am emily chang. our special guest host for the hour, chamath palihapitiya, is still here. we are talking about netflix expanding its on-demand empire introducing it into france and other european countries. it is the biggest expansion in years. amazon offers a rival service. the first wave of shows will be from hbo and are now available to watch. jon erlichman is an l.a. what is the most significant about this international expansion for netflix? it is the most significant expansion they have seen in three years. >> is a huge opportunity for them to get subscribers. what do you need as a tv network? all sorts of programming. you have to make it, go out and buy it. you also need people to watch it. they had more than 48 million subscribers at the end of the last quarter. clearly they're looking for people who can consistently pay for their service. that is why they are launching these

netflix is a technology company based in saratoga. think apple and google and microsoft and facebook all netflixt the success of with its content and thought, heck, we can do that too. beginnings of the this starting to happen both at amazon and microsoft. $3gle with you to has spent million.n, 500 what people do not realize about youtube is one of the things people think about when they think of you to its dogs on skateboards or other things you might find on america's funniest home videos. what is really starting to happen is it is becoming a platform -- it is the common the newest platform for professionally produced content as a way of bypassing the thatibution mechanisms comcast added a cable companies have or broadcast networks have. amazon and google are the people that control the endpoints of our devices. big are going to be really players in that. >> in your chapter "changing the world one screen at a time," you write that it will be a good proxy of how it will evolve. >> yes. one of the things people forget about hbo is mos

if you look at netflix going over $60 million. near term we expect them to launch the markets in the fourth quarter and take our earnings estimates down. but longer term, we're more constructive and applaud netflix. and then cost energies to expand globally. longer term, if the street gives them a pass on the earnings revisions downward, we like it for netflix in general. >> the growth is fantastic. does the lack of earnings ever catch up with them? >> i think what you have to look at is catalysts. really the bulk case was three-pronged. you have got international growth, pricing power and originals driving u.s. subscribers. we have got information around those three this year. what is the next thing going to drive the stock? one point i would like to make is the media companies, what netflix is doing is they're improve the digital distribution of content. if you think of the media companies, they stand to be positioned well from netflix. i would think about that as a lateral in terms of a disney or cbs, a natural partner. >> you

the netflix deal, i heard dealthe netflix to comcast does not touch the internet. it is a private line. it is from netflix network to the comcast network. in terms of paid prioritization, will people be able to do these side deals where they do direct lines bypassing the public internet? that is probably 89 or 90. when chairman wheeler was walking out, someone from the press asked about that question. he said it does not apply to the netflix deal. >> i agree with that. let me explain. these open internet rules are aimed at governing the connection between internet service providers and consumers. when we talk in that context about paid prioritization, what we're saying is that at&t should not be allowed to cut a deal with netflix. it will speed up the delivery of netflix traffic. that is compared to other services. we will have a debate over whether such an arrangement might be reasonable. the interconnection between networks and netflix directly comcast and between comcast with an intermediary is something that the sec has set it outside of these rules. it is a de

let me use an example of netflix. netflix is our largest customer. we are their primary carrier of internet traffic. that buys the connectivity from cogent because we deliver the highest quality at a list price. we have dozens of competitors. we we in business every day by competing, offering below list price and highest quality. netflix wanted to do business with us. but we could not deliver all the traffic. we deliver no traffic, a paying comcast customer doesn't request. when we deliver that traffic, the ports for connections between our network and comcast became full. we went back to comcast and said could you please upgrade these connections? normal pattern of practice we have been doing for years. even though comcast is not qualified to be a global pier, we will give you free connectivity, allow us to deliver the content at our expense to the customers that you are charging those 20.7 million customers that you collect $30 million a day from. comcast refused. they not only refused cogent but every other major backbone and in doing so, forced n

let me use an example of netflix. netflix is our largest customer. we are their primary carrier of internet traffic. netflix buys that connectivity because we deliver the highest quality at the lowest price. we have dozens of competitors. we offer the lowest price and the highest quality. netflix wanted to do business with us. they continue to be our largest customer, but there was a problem. we cannot deliver all of the traffic that netflix was delivering to comcast customers. when we deliver the traffic, the ports for connections between our network and comcast became full. we went back to comcast and said, can you upgrade? comcast refused. they not only refused cogent, they refused every other major backbone. in doing so, forced netflix into a corner. they forced netflix to have to go and directly enter into a contract with comcast, paying a higher price for a less robust product. that is not a free market. that is an abuse of market power. there are two parties that do not sit in front of this committee today. tens of millions of consumers, i thi

significantmost about this international expansion for netflix? most significant expansion they have seen in three years. >> is a huge opportunity for them to get subscribers. what do you need as a tv network? all sorts of programming. he have to make it, go out and buy it. you also need people to watch it. they had more than 48 million subscribers at the end of the last quarter. clearly they're looking for people who can consistently pay for their service. that is why they are launching these european nations. they really look for markets where they can find people to pay as opposed to where markets have piracy is a tissue. they may not be spending as much as netflix, but there have been some estimates that the hbo contract might be in the neighborhood of millions of dollars per year. they want to get people to buy more stuff through amazon here. >> what do you think of a company like netflix? 48 million subscribers now. they take up 34% of internet traffic at the peak time. >> it is an amazing service. we're large shareholders of that company. t

that is a deal that netflix struck recently with comcast. their service reaches comcast faster than their competitors. is that fair? net neutrality would make it an even playing field. the toll keepers like comcast

whether it's netflix/comcast, netflix/whomever.etflix may not be all that average representative of your content provider. so i'm concerned that regulation is going to be spawned through a prism that might be a false one. i also want to point out that netflix has certain counterstrategies in its pocket. if it wanted to, you know, for example if an isp gave it a hard time, they could impose an isp surcharge for customers of that isp to discoarnlg people to switch to a rival isp. they're in the driver's seat, and that's just another reason why we should take, i think, a go-slow approach to adding on another layer of regulation. >> i'm going to give anna maria the last word. >> just to answer gerry's question, there is a blog post on the fcc's blog that was put out friday in response to the chairman's blog by brett glass who runs a wireless isp in laramie, wyoming, and it is an impassioned plea to not regulate the internet explaining from a very small isp's perspective what that would mean to his ability to gain investment. so that is

he has the netflix users who love netflix., we've seen the numbers they don't love comcast as much. when he's motivating his base to go out and be vocal on his behalf that's definitely something for comcast to have to deal with and the rest of the cable industry as well. >> you asked him valuation of netflix stock. he said some days it seems too low, some days too high. >> the last time i asked him that question when the stock was nearing that all time high he was much more definitive. the fact that there's a question, ceos defer and say it's up to markets. if i were an investor i would prefer more confidence in that stock price. >> yeah. almost recovered entirely the losses from that brutal spring. we'll see what the summer brings. when we come back, elevation partners, roger mcnamee, his investment in facebook and his own news innovation when "squawk alley" comes right back. >>> cue the u2. a lot of tech news to cover at the code conference including the buzz over that $3 million apple beats dale. joining me is roger mcnamee

>> netflix stacks up well against other over the top providers but also video service and netflix keepsme on my toes but it makes me think about a world where my customers want on demand content on any device anywhere they go. and how do i get those devices for them? we launched a product called contour in august of last year, and contour responded to fighting the customers told us. they wanted more vod content available. they wanted more to us in the home for the dvr. they wanted more storage. they wanted access to all this content on second screens in their lives. and last but not least they wanted a really powerful recommendation engine that kind of knew them and recommended other shows to them. during the month of february, 600,000 households in cox have contour know. 140 million learning activities were gathered by the recommendation engine and almost 1 million times our customers consumed that recommendation to the average household was watching 22 channels on month, which we found odd, to 29 channels on month. customers will respond if you innovate. >> if you take a step back fro

netflix understands that, ok? the fact that they paid and the ceo then said comcast is a tax, we a toll or can afford it. others behind us cannot. this tells a legitimate antitrust theory. professor hemphill and i may disagree on this at it is very much a similar theory to the microsoft theory that the doj .itigated the difference here because this is a merger is under section seven, we are under the merger.t see then you nip it in the bud. >> i appreciate both of you. andink it provides insight ideal back. as a netflix subscriber, do you watch "house of cards?" [laughter] >> are you trying to imply something there? don't go to the metro. [laughter] under advice of counsel, i want to answer the question. [laughter] >> we tried to get frank underwood to come here but i don't know. and these will be the last of the hearing. mr. marcus or mr. cohen. >> i was starting to feel neglected. >> there have been allegations that comcast may exclude and interconnect. some commentators assert that they will control approximate

. >>> plus, did uncle carl dump all his netflix? >> i think there's a lot of verbiage about it. >> that's what some unusual options activity is suggesting. we'll break it down. show you how to profit. >>> and is one of the biggest stocks in the world about to get even bigger? >> i was hoping you'd say that. >> traders say yes and we'll tell you why. the action begins right now. and we are live from the nasdaq market site once again on this dreary and rainy friday afternoon. i'm mandy drury sitting in for melissa lee. these are the traders here in times square. hi, guys. great to have you with us. this is what matters to traders now. bonds are rallying, yields have hit lowest levels since october and small caps are being hit real hard and they are close to a 10% correction. but the s&p, well, guess what? is still near its record highs. will it be the next to tall? or it will fall. let's try to find out. dan nathan, how troubling do you this think this is? it's been hitting are new record highs. >> it is potentially troubling but it's

she said netflix is her new favorite platform.lers for season two. >> you asked her whether or not she has trouble buffering, streaming through netflix. not familiar with that -- >> yeah, not familiar. i would imagine netflix takes care of their own. we did catch up with a lot of other people last night. a very fun crowd at the webbies. here's some of the other commentary we heard. >> the fcc right now has opened up for public comment, and so any one of us citizens, especially all of you that participated in the fight, call up your representative, the fcc, maybe your senators, ensure we get broadband reclassified as common carrier. >> i'm for equality, everybody being treated the same rather than having corporates -- corporations being more powerful than the common kid working out of their garage. >> suki is one of the most valuable dogs in terms of brand on the internet right now. suki, how do you feel about your fame online? a little shy. and bored, apparently. so what's next for you? i mean, the mobile era is upon us. people ar

with regards to netflix he decreased his stake in netflix.netflix's stock, carl icahn decreasing his stake in net flick. finally made a big move in herbalife to 17 million shares his holdings in herbalife. carl icahn is filing like crazy in after-hours making big moves in big companies liz and dave, you both know but those are three main headlines crossing right now. david: thank you very much, cheryl. liz: the s&p futures are closing right now. let's head back to bob iaccino in the pits of cme. how does it look? >> a little bit of short-covering into the close but knowing really to write home about. interesting you mentioned in the 10-year note, keep eye on that. you have a interesting situation for fed and janet yellen. they want to end qe and rates are actually going lower. anyone structuring strategies around more qe coming, it is not coming. liz: thank you very much. bob iaccino. david: on a day like today you would expect the vix to spike as it did about 8% but throughout the market gyrations the past three months, the volatility index,

clearly you are watching netflix. one streaming company accounts for more than a third of prime-time internet traffic. would you pay $84 million for boxes with lines between them? $60 million worth of contemporary art. "varney and company," we are about to begin. >> the big names which are moving, they make tractors, heavy equipment, global company, considered an economic indicator, lowered their sales forecasts, the stock is down 2%. after that long hard winter, not much reaction to the stock up $0.20. overall stocks taking a breather, look at the big board, down 52 on the dow, 16662. i would say we are three solid rally away from 17 k, eager to use the new graphic which we have available. the s&p 500 flirting with the 1900 level, hit that yesterday, fell back but still pretty close to record territory. that is the broad market. that is your snapshot of the market. the top story of the day which affect your money, democrats want to make it more difficult for businesses to relocate overseas for tax purposes. similar t

in this netflix/comcast arrangement. well, you might say, all right, that's because traffic would equal netflix is different because it generates so much traffic. what percentage of netflix are settlement free? over 99%. now, i think absolutely that deal with comcast, the deal they have with other parties may very well be spirally legitimate -- entirely legitimate. again, every indication we have suggests that this was hashed out between two parties. netflix got some benefits, and that's fine. and i think we should allow for that differentiation to exi and i think we should allow that to exist. for even the audience i an finde one far to the left on this debate but in the next neutrality debate -- okay, to the left. i'm the one here advocating for a regulatory role in the connections and i often find myself with my friends on the other side suggesting the approach the chair man suggested in the net neutrality or the open internet proposed rulemaking which would allow for the companies to do the agreement as long as there

you don't have to play in netflix. this valuation is crazy. if it were down by 33%, you wouldn't say, oh, now it's dirt cheap. i've got to own it. you would have said, yeah, you know what, that makes sense it came in that much. you don't have to play. it's dangerous on either side of the pool. >> all right. well, another comeback kid here, twitter soaring 63% since the recent low on may 11th. since it dropped more than 60% from the two-week high back in december. managing director, victor anthony with a buy rating on the stock since day one. victor, good to see you. >> thanks, thanks for having me. >> these analysts are coming around. two upgrades on twitter over the past couple of days. you've been a buy rating since the beginning, although we did see the stock drop 60% or so from the highs. are you seeing that there are signs of growth at this point? same size of analysts are seeing. the notion that, for instance, international users make up of big giant% annua percentage. >> yeah, i've been seeing those things from day one. i think the stoc

i do not know who mentioned that about netflix as a failure of the cable industry. >> are you trying to get me to name names? >> i am the gray hair on the panel, literally and figuratively, and what i remember is netflix would not even exist if it were not for the cable industry that developed the dialogue internet -- dial-up internet to the cable system with the fastest speed than most capacity. so, there are a lot of companies that are in existence simply because we as an industry spent a lot of time in capital building the internet is this. >> they are actually existing on the infrastructure that you built, and on the content that we produce. it is ok. competition is not a bad thing. we have to do is respond, and figure out ways to innovate. i agree with nancy. one of the things we're doing that is important is figure out how to make authenticated television work, and allow people to get their content on every device in an easy mechanism because we could compete there. we have superior content. we have to have superior delivery systems to distribute that material. >> i have to amp

this is from netflix and shows the average streaming speed of netflix on comcast from january 2013 untilu see the slowdown to a low this january us about 1.5 megabytes per second. it jumped 66% in in march because the companies struck a deal where netflix would pay for faster performance. >> back to the question -- does my bill go up? >> it is a big question mark. some people feel it will. a month for time warner cable. that is more than a year ago and i paid extra -- retail. liebmann on every dime of this utility thing called netflix or entertainment or whatever comes out of jcpenney's pocket. pay for theefer to entertainment then their genes. -- than their jeans. >> how does this full over into disruption of amazon? amazon will think take their share? >> you have amazon taking the prime rate. now you have another $20 a year i have to pay. gtohey are using shop. >> consumers have to manage their costs because the top line is not growing. >> they are much more cautious than corporate america. >> we continue this conversation on managing costs and what retailers are doing. our twitter que

this is unlike the netflix and teslas of the world.s actually is a stock that you should have have tash this is a lot of skepticism. >> today, it was 30.65, i was looking out to september because there's no august options listed, and i want to catch that next earnings event. today when the stock was 30.65, you could have sold the september 26 put for $1.45, and used the proceeds to buy the september call for $1.45. cost you nothing. what you have done is put the stock on 26 september expiration. to the down side. you start losing from there. at 3, you have unlimited risk. there's a lot of asymmetry to the trade. between 36 and 27 you wouldn't lose anything. now here's the thing. mark the market between now and then, as the stock is closer to 26, you'd make money, and make it as it got higher and this is creating a wide band for something that's a volatile situation, a controversial story. let me tell you, if you get a move like facebook did in 2013, once they're able to demonstrated to street and investors how they were going to moneti

they have done this in the case of netflix where they decided netflix can pay to get their own fast lane to get their stuff delivered faster than competitors. that is why you have over 100 companies sank don't allow this merger to happen because it will be anti-competitive to every good and service that might otherwise be delivered. , is there anybody making that case before congress? case?ing the case, which >> that this goes beyond cable television and it has to do with internet access. you're going to control a third of the internet access and you can decide what kind of content gets into people's homes. >> definitely. although most of the hearing focused on tv. internet was also another big topic. comcast has made the case it will control one in three households but it still ys the landscape is changing. one thing they are trying to strike is that maybe netflix is being a little bit self-serving trying to make this a consumer when really they don't want to have to cough up more money. that is an argument to have heard comcast make. they say and they have to compete with netflix who w

the chief product officer at netflix says changes are coming to the main page.nstead of satisfying a sea of titles, the company will try to present with three or four personalized choices on the korean. you should see the rest of the options by clicking through. if you want to watch "the wire" on amazon, today is your lucky day. host of classic hbo shows through the prime instant video platform "six feet under" and others, as well. >> on the personalization, nobody remembers, like, a year ago, they released the netflix max, which was a clippy thing for those that grew up in the '90s, a question and answer thing you could do. what kind of show are you interested in? which was meant to dramatically streamline this. they need to do it. everybody is doing tiles. the amazon fire box looks like the apple itunes. and we need easier ways to discover content. the running joke is you spend more time on netflix deciding what to watch than actually watching something. >> the key is to have a good search function because some of the cable companies, like comcast, xfinity, an

netflix plans to expand deeper into europe fisher.ore on reading a stink -- read hasting's ambitious plan. >> six new countries on the continent. germany, luxembourg, switzerland, austria. i no longer have to try to hide my location so i can download netflix. subscription not available in your country, standby. they may be changing that. anticipates 70% of revenue coming from outside the united states. when you look at their current subscription model met those are remarkable numbers. they're about 35 or 36. most of the subscribers want to go further. >> to buy very much. -- thank you very much. the global razor blades market is dominant i names like gillette. one startup is trying to dethrone these companies and the strategy involves buying a former east berlin factory. david tweed has the story. >> in a small town in the former east germany, a new york-based startup is making waves. ♪ >> i am the cofounder and co-ceo. it is a grooming brand. we sell around shaving products through her website. a couple of companies have control the

recently netflix, an online video distributor signed an agreement with comcast that would allow netflixs rather than pay companies to carry traffic between the servers and comcast customers. on the one hand this could be seen as a simple straightforward business transaction, after all netflix is responsible for a third of all united states web traffic. paying comcast to paid directly to traffic through other companies which are struggling to handle its traffic may simply have been categorized as a smart business decision. but on the other hand, netflix it self raises concerns about its agreement with comcast asserting that it was forced to pay comcast for reliable delivery to comcast customers. in that position to the comcast-time warner merger, netflix ceo reed hastings and david wells explained that the internet business is a long-term threat from the largest isp driving up profits for themselves and costs for everyone else and that the comcast-time warner cable merger approved, the combined company would possess even more anti-competitive leverage to charge arbitrary connection for a

netflix in the u.s. is a different world.china, there is a huge amount of work that needs be done with the motion picture and tv. the video sites are the tv of china. >> do you fear regulations that control movie rights and free to air television, censorship issues are going to suffocate what you are doing? this is the first step in control of streaming content? >> i don't think so. there will be complaints from the tv stations heads. worrying that the new media is taking their lunch. of course. they are very paranoid. they are worried. >> the state owns those broadcasters. are they protecting them now? is this an example of that? >> we are not in the strong position legally to protect them. they have some connections. [indiscernible] >> speaking of the law, what laws protect you when you go out and buy content? what protects you now in china? say you buy another show, the show. >> on that show. then it is taken away. >> china is in transition. policy, today, it will not be the policy of a few years. it is hard to define exac

often times you are foiled and can't watch netflix.veryone thinks is a big market for and have aducts pricing system, a payment system that works. when you look at what rate hasting what's to do, he wants at to 80% -- when you look what rate hasting's wants to do, he wants 70% to 80% of revenues from outside the u.s.. germany, france, austria, belgium, switzerland, luxembourg. lookig question when you at their total number of subscriptions, 46 million, state and right now it is 35 million. clearly this is a u.s. company. will it take hold elsewhere? i know you spent some time in austria, is "house of cards" translated into -- [speaking german] i don't know. >> we will wait and find out. very nice to see you all the way in berlin. you will be able to watch that without having to go through elaborate measures. thank you so much. that does it for today's "in the loop." transcanada's ceo rob sterling will be joining me live on "street smart," talking about the push to get the keystone pipeline approved. 3:00 p.m. eastern. we also have the

standpoint to the determining service provider and netflix. >> telecommunications reports. we are talking about open interest rules and the fcc. dorothy you are first up, please go ahead. >> first i watched the hearings and i found it extremely amazing and the fact that while both sides delivered some interesting comment, what i found reflective of the issue [inaudible] and are to bring up valid issues that are being denied access to the american public that can be in fact part of their health costs eat your well-being in knowing what point are being taken off the table for public consideration. and the five protesters asked you to and not vote for the proposed rules, and they were escorted out i security. they were not allowed to go to the mic or speak up. fcc did not think that was what the meeting was for. they are required by law to meet once a month and go over major cisions. decision there is an opportunity at the fcc now for the purpose of yesterday's vote was to say this is what we are thinking of doing now we want the public to tell us what they think and since feb

. >> caroline hyde. ,oming up next is netflix taking on europe. they announce the biggest expansion since 2011. >> welcome back. by administering a. cranny.manus basic resources and telecoms lead the markets. the bank of japan does nothing. zone consumer confidence is expected to rise a little bit later. the lowest since 2012. what will happen in the global economy? more talks about exit strategies. bankers, what stocks should you be eyeing? >> three. be facing ¥50 dollars -- $5aling with sanction billion for dealing with sanctioned countries. more than many expected. it is the value of the pound that is eating into the earnings. the stock is down. i love this company. the world's largest shipping line. their stock is going higher. >> that is the scenario. >> let's give you some of the top headlines. the japanese central bank refrains from additional easing, saying that the economy can weather the impact. the contraction is projected for this quarter. on bank is counting companies still wanting to invest. the bundesbank board member sees new risk

the government deciding right now whether streamers like netflix should pay more for speedy delivery. this is an net neutrality issue in the big deal. so are we. "varney and company" about to begin. ♪ stuart: we start with big names that are moving, start with the biggest retailer of the mall, walmart, lower profits, slightly lower sales, they blame the weather, stock down 2%. dickens story at cisco, maybe a sharp slump in business. maybe it is easing. the market thinks so. is up 7%. this is a door stopper stock, usually dead flat $24 a share of 7% and a bigger loss at 3d printer maker x 1. remember phil roosevelt, the barons guy talking about toll-free the sector? called a glorified play-doh factory? maybe he was right. almost all of them are coming down. check the big board, that is a sell-off down 144 points as we speak. billionaire hedge fund manager david tepper says he is nervous, i think he brought this market down a little. look at the ten year treasury. that is not right. that is incorrect. it is not 5.5%. a lot of people which was but it is not. the ten year treasury is righ