reed hastings doesn't generally care what investors think. you think microsoft just paid $27 billion for linkedin. here is a company that has a market cap of about $36 billion. would that be the aol/time warner of this thing and would reed hastings ever sell? >> investors always ask this question about netflix and where would be a good spot for them? would it be apple, google, microsoft? obviously it will be a very large check because you're talking about something north of $50 billion to ultimately take it out at these level approximates. >> so you don't think it would happen. >> we don't have any insight whether m&a is imminent. >> we have netflix tanking. yahoo! is holding steady, and ibm is up after hours. let's talk about what this means for the broader market rally. guy, let me kick off with you. of course, we have fresh record highs today. >> i don't think it means anything. i don't think netflix means the market is going to sell off. the market has a mind of its own for a while. if you want to talk about ibm specifically, i'm sure we

reed hastings said back in january, "we love people sharing netflix." today the f.b.i.it is no longer hunting the mysterious hijacker known as d.b. cooper. the leads have all dried up. back in 1971 he hijacked a northwest orient airlines 727, then over washington state he jumped out wearing a business suit, a parachute and a bag with $200,000. some of the money was found, but he never was. and there's a develop tonight in another long-running mystery. who committed the murder in the mansion in the popular board game clue? for the first time since clue was introduced in 1949, hasbro is replacing one of the suspects. mrs. white is out. dr. orchid is in. she's a biologist with a ph.d. in plant toxicology. certainly sounds guilty. and we'll be right back. ...cleasee ya!ake off. when you're living with diabetes. steady is exciting. oh this is living baby! only glucerna has carbsteady, to help minimize blood sugar spikes. and try new glucerna hunger smart to help you feel full. the ford freedom sales event is on! with our best offers of the year! ♪ i'm free to do what i want.

emily: so, john and ann doerr, bill gates, reed hastings, google, i know eric schmidt is on the boardhow do you get these kinds of people to support you? sal: i mean, a lot of the folks you just mentioned, actually ended up -- they just found themselves using khan academy or they used it with their children. and so they were able to directly feel the benefit of it. emily: i am curious now. because your model is there is no employee equity, right? sal: everyone gets the same stock package that i have. emily: there is not going to be an ipo, right? [laughter] sal: there is not going to be an ipo, no. emily: so i wonder if at this point, do you worry about making ends meet? sal: we are a strange beast on a lot of levels. where we are, in some ways, we are a high growth scalable tech thing that is reaching millions or hundreds of millions, but at the same time, we are not for profit. we are competing for the top people with google and facebook and dropbox, all of these kind of -- uber -- these hot silicon valley companies, but we are not able to give the stock packages. we find if you giv

ceo reed hastings said there may be some resisting -- resistance. this is what he had to say. mr. gs: we have not seen any affect. we changed prices to the 8, 10, and 12 last october and we have had a couple of quarters of great growth. this is really around change resistance. whatever the price is for something, people do not like it to go up. in terms of new members which is most of what arrives growth, the new pricing is working great. >> also scrubbers noticed a difference and did not like it. old subscribers noticed a difference and did not like it. that viewershow are sensitive to prices. rishaad: 47 million subscribers are there already. where is the growth going to come from? >> it will come from international markets. most analysts think -- rishaad: they have to nail down a deal with china. provided anynot thing on how they will do that. they have done ok but they have not gone into localization, targeting local languages and local offerings. rishaad: thank you very much. we will take a break that next we are expecting their minutes from the reserve bank of australia's las

an interesting call from reed hastings, not the numbers they want.suggest it is about the price increase and the growth will come back. i hope that is the case that the trend has not been their friend. scarlet: the message is be patient. thank you. coming up, antitrust officials said to look at filing lawsuits to stop and then take over -- anthems takeover. ♪ ♪ scarlet: u.s. antitrust official mulling lawsuits to take over over--s this was your scoop, what did you learn? departmentice antitrust division has some serious concerns about both of these deals. they feel that they are bad for consumers because they are of the biggest insurers in the u.s. scarlet: you cover health insurance companies, health care overall, specifically, what are antitrust officials concerned about, the number of players? deals, the concerns are a little bit different in each case. anthem and cigna would be big in the market for health insurance sold in big companies like bloomberg or jpmorgan. aetna and humana combined, the concerned, medicare advantage, private medicare pol

reed hastings says it is due to price increases, not market saturation. >> with new members, we haveot seen any effects. we changed our prices last october. we have had a couple quarters of great growth. this is around change resistance. whatever the price is for something, people do not like it to go up. but the new pricing is working great. emily: netflix is seeing sales and profit growth from fast-growing international markets. what are investors looking for? i want to bring in cory johnson and paul of comscore. they do not believe this is due to market saturation. it is simply because netflix raised their prices. these new prices are kicking in. is that the reason? cory: i wish i could just listen to reed. look, here is what we know. they lowered the cost of marketing at the same time they raised the prices last quarter. we can see that u.s. subscriber growth fell to 0.3%. i think it is the lowest they have ever reported. they added fewer subscribers and spent money marketing. international was not terrible in terms of growth. but here they are, spending so much, being forced to

ceo reed hastings says it is due to price increases, not market saturation. is that the reason?e know that they lowered the cost of marketing, at the same time as they raised prices last quarter. we can see the u.s. subscriber growth fell to 0.3% sequentially. my model goes to 2012. i think that is the lowest ever reported. they are spending so much, being forced to raise prices because content costs are getting out of control. they've got over $12 billion in off balancing content cost, that is raising prices, and that is causing new subscriber growth to slow. emily: ibm beating estimates despite its 17th straight quarter of revenue decline. it seems the company's big bet on watson may finally be paying off. revenue, including the artificial intelligence platform, rose 3.5%, the first growth since the revamp. >> this was a meh quarter for ibm. the strategic imperatives group that includes watson and the cloud business, the cyber security elements of ibm, all posted growth. one of the interesting parts, although it is 38% now, the revenue growth of this group has been declining y

on the earnings webcast last night, reed hastings talked about the impact of price increases on subgrowth. >> people don't like price increases. we know that. it's a necessary phase for us to get through, and then with theip creas creased revenue, we're continuing to invest in better and better content. that's what makes us feel very positive about the long-term and this is a short-term phenomena. >> apologized on that webcast for some of the volatility. he said it's not easy on anyone. >> volatility is never about good. >> it's always about bad, right? >> it's true. >> this was a baffling call. they talked about ungrandfathering, which is a word if you check that, that they created last night. any time -- you know, of course we un-grandfathered him. spell check wouldn't let me have it. this was -- when i say "baffling," the people who didn't re-up, were people who were -- it was people who were afraid of the price increase. now, what this says is, i've always felt there's costco, amazon, you pay for the prime. people didn't pay for netflix going on. >> right, they had more churn than may

what i like to look at with this business is obviously quarter to quarter, according to reed hastingsn the earnings call. i look at, you know, how bingeable are these shows? i don't know if you've seen "stranger things" but this is amazing. if they keep putting up amazing content like that over the long term, i'm still bullish on the business. >> it's sort of a catch 22. would you rather have more users who play less? >> i would rather have a sustainable business that can grow from there. i like country that is have engrained themselves into people's daily lives, which i think netflix has done. >> they are talking about net flick for people whose card information changed slightly, losing netflix and not re-signing up for it. doesn't that speak to some lack of loyal, any blip here, and i'm going to turn off? >> i think netflix is trying to transition away from just being a carrier of other people's information. if netflix basically they probably don't want customers who only look at them as a pipe. they want people who come to them for the netflix content. amazon is obviously making so

he cofounded netflix with reed hastings and marc randolph, and then went on to found red box.ed his attention to movie theaters with another startup looking to disrupt the movie theater business called movie pass. it is a $30 a month all you can watch inception service to go to the movies. emily: first of all, movie theater attendance is down. fewer people are going to the movies, let alone multiple movies every single month. why do think this is a good business? mitch: seeing movies in a movie theater is absolutely the best way to see it. i have been a fan of movies all my life, and in fact that is why i love this business. the experience of going to the movies has just started to get innovative. we have got digital film being distributed now, we have theaters upgrading the environment, great seating, they deliver food. but what has not happened is the business model where consumers participate in the business has not changed in a long time. you come up to the ticket counter, you buy a ticket, you pick the films from the newspaper or online, and that i think is really ripe fo

we'll get all those numbers and ceo reed hastings all important letter to shareholders after the closingl. brian. >> sorry, can i ask a quick question, julia? >> jump in. >> sorry. >> to underline, you save revenues and earnings for last. it almost doesn't matter when it comes to netflix. it always tends to move based on whether or not they've grown subscribers enough for the expectations of the street. >> exactly. for netflix the subscriber numbers tend to have a much bigger impact on where the stock moves than those re knew or earnings numbers. this is a company which has so much expectation of growth baked into that stock price. and what's really crucial here is if you're looking in the united states if they're in half of broadband households how much room is there to really grow significantly here in the u.s.? there's expectation of massive amount of growth overseas, but how much netflix grows every quarter overseas depends on a lot on where it's launching, which markets its launching in. and this quarter they haven't launched into as many new markets, so we'll have to see what reed

. >> we're going to get -- you mentioned reed hastings, we have netflix after the bell at closely watched. sounds like you're a big fan? are you a shareholder as well? >> i'm not a shareholder. i like the business immensely. i like the space immensely. i like the management immensely. i think reed and ted and the team they have there has just strategically done a marvelous job. look, if you're investing in a quarter, you know, i think the next quarter, two quarters, got to look at international, which will probably grow pretty well. very well, actually. i think analysts are saying 2.5-ish, 2.5 million adds. domestic slowing, 600,000 adds. so you've got upsidee internationally. flatness domestically, but, boy, do i like how they run that company and they're investing for the future. that is, perhaps, the leading media company of the next decade. >> let's go to one that would like to have a greater presence, i think, in the way media is consumed. twitter. >> well -- >> what is your view on -- let's just say from when dorsey came back to where that company is now, do you think that it remain

that is reed hastings, defending the raising of netflix prices.tumbled so much less night after the company said the price increase cut subscriber growth. a 14% slump. it was a phenomenal fall. check out my screen. it sent shivers down investors spines. point six 8 million subscribers being added, lower than what they expected. they wanted to see more than 2 million added overseas. look at the slump we saw. down from 13%. putting it into perspective. when hundredr, 60,000 added in terms of the united states. a much lower than previous number. this is the slowest growth seen in three years. people do not like change. perspective,to check out where we saw in netflix shares come from in the last five years. 12% fall may not be road that much. that much.erode end.another nintendo. post pokemon rise go. absolutely sensational. we built this chart this morning, we were talking about pokemon lifting nintendo past sony. let us role netflix into this. valuations.rket netflix valuation is around 42 billion. now, nintendo has done that as well. let us zoom i

and if the stock is going to see fresh record highs it will require a new narrative from reed hastingsl have to see what happens here. let's now turn to nintendo's newest game, pokemon go. it's sweeping the nation. this revolutionary smartphone app has soared to the top of download charts. nintendo plus stock has skyrocketed. joining us now is selina wang. were start with the basics people who have yet to download the app. how does this work? hasna: how viral the game gotten is insane. around new york you will see multitudes of people running around playing this game. you can think of it as fantasy google maps. you walk around, you try to find pokemon characters overlaid over the real world and you will try to catch them. earlier we were showing the adr for nintendo and how it's soaring today, up over 30%. in japan the shares rallied by the 25% limit. you have the knee-jerk reaction, but what does this really mean for the company down the road when the fever dies down? tough times been a for nintendo. they are seen as not being ill to keep up with the changes in their gaming industry i

charles: the reed hasting guy runs a business in a unique way. what about the pricing? it felt to me they've had a series of price increases. they did a price increase, looked around and got away with it. and now it has caught up to them. even though it may look like a little, i think that may have hurt them. >> and honestly, charles, the math is still out. i don't know what bundle you have, but i think a lot of consumers are beginning to add up. okay. if i have netflix, if i'm paying for hbo's product, and i still have a cable subscription, and then sometimes they add it all together and they think you know what? maybe i'll just keep cable, there's enough things to watch. there is a kind of penny pinching mentality that i think a lot of consumers to your point once it gets higher and, listen, netflix is responsible. they send you e-mails. we want to continue to send you these great quality and a lot of people are saying what? my cable bill is this, i'm paying for these two or three other things, maybe amazon, i don't need to pay for all of this and let me see how i do

>> well, i just want to weigh in here an give you more color from this reed hastings letter to shareholderhy the subscriber numbers less than expected. they talk a lot about ungrandfathering and the primary driver and specifically says that they're not suffering because of competition or from market saturation. they say that they believe that amazon prime, hulu, cbs all access, the surge of all of these new direct to subscriber options that are not part of the tv bundle, they say we believe we're growing against linear tv hours and did not contribute to the miss in q2. they also say we don't believe market saturation is a key factor in the u.s. given that we experienced similar performance over the same period in multiple countries with differing levels of netflix market penetration and very specific. this is really about ungrandfathering and not competition or market satch wags and one other key thing here, so much interest in international potential and the markets they launched in through the end of 2013, they said they're on track to delivering agree gags and they're profitable and now

reed hastings, i would pay more for that and more for amazon prime. bezos clearly watches the show. >> of course. >> what else is there to do, 9:00 to 10:00. >> he's in seattle. >> how do big ceoss get anything done in the morning with our show? >> i don't know. >> 9:00 to 10:00. >> i don't know how bezos gets anything done is beyond me. opening bell in four minutes on this friday. that live interview with fed vice chairman stanley fischer and a lot more. >> we are -- >> team herc. [ applause ] at pg&e, we believe solar should be accessible to everyone. our partnership with habitat for humanity allows us to provide the benefits of solar power to the types of customers who need it most. pg&e provided all of the homes here with solar panels. the solar savings can mean a lot, especially for low-income families. with the savings that i am getting from the solar panels, it's going to help me to have a better future for my children. to learn how you can save energy and money with solar, go to pge.com/solar. together, we're building a better california. hi b

and reed hastings where he's always trying to overcome challenges and succeeding, he's on the board ofacebook. meg whitman has hands full with hewlett packard but on the board of -- in nonpublicly trading companies nobody made top. the twitter co-founder, he's on the board of beyond me, medium, good fit, work pop and his own new start-up. back to you. >> these are busy, busy men and women, aren't they? a lot of them out of the same companies. they overlap there with disney and the tech space. >> where this became a big issue is back during the dot com bubble where we started looking at boards, there were people on 10, 12 boards, how do they manage it. >> we're going to take a quick break. we'll be right back. over 100 years ago as a benchmark for average. yet many people still build portfolios with strategies that just track the benchmarks. but investing isn't about achieving average. it's about achieving goals. and invesco believes doing that today requires the art and expertise of high-conviction investing. translation? it's time to bench the benchmarks. >>> we got two hours left in

fresh gains would require a new narrative or a new story from ceo reed hastings.e sector and the u.k. in the last 20 minutes. more specifically the real estate funds. real estate reporter jack sears. jack, rejection over aberdeen. what is the story now? >> we have just picked up on the first prophecy that is coming to isket -- first property that coming to market. there was some debate at how quickly the fund would move. and how quickly they would get properties out in the market. we think there are plenty more out there. what it shows is they are not hanging around. jon: aberdeen also extends its suspension of the u.k.. what you make of that? what aberdeen was saying, most of the investors have submitted with redemption requests and have canceled those. what i think the extra delay is about is just reassuring the sca that those who have submitted reaction requests have had long enough to really think about that because if they don't withdraw them, they are going to have to accept a 70% discount. jon: updating us on the situation in some of those property funds. i