MarketWatch Proposes Netflix Acquisition by Apple Inc.

In a whitepaper titled “Should Apple buy Netflix?” research firm MarketWatch explains the pros and cons of this potential acquisition, arguing that Apple wouldn’t have a problem paying as much as 7 billion dollars for all of Neflix’s assets.

Citing analysts and Apple watchers that like to analyze such scenarios from all angles, MarketWatch says Apple could roll out a television as early as next spring.

The firm cautions that this device should not be confused with the company’s current Apple TV set-top box.

Neflix and the Apple TV already go great together, but MarketWatch thinks Apple wants more. Much more.

“If Apple is known for anything, it’s that the company likes to control as much of what it touches as it can, and based on past successes in media, that would include giving Apple television buyers access to enough content to make them forget about looking for something outside the Apple universe,” says the WSJ-owned market research company.

And Netflix is all about the content, really. Jeffrey Sica, president and chief investment officer at Sica Wealth Management, believes “It’s no secret that in the world of Apple, the television is among their most important initiatives, and Netflix is a brilliant entry into the acquisition of the most coveted asset in entertainment, which is content.”

Sica admitted that the theory wasn’t very solid though. The reason, “it would be far less costly and time consuming if they just acquire the extensive Netflix catalog and implement a strategy that would allow them to acquire titles quicker and exponentially grow that catalog.”

Indeed, Apple already has iTunes, and the Mac maker would certainly have to pay a premium to acquire Netflix. Plus, people can already buy and rent individual TV show episodes, or entire seasons of shows, as well as movies, through iTunes.

Everything works on the iPad and iPhone, and guess what? The Apple TV offers access to Netflix’s entire instant-streaming catalog.

“It is tempting to think about possible corporate combinations like this in the digital world,” said N. Venkat Venkatraman, a management professor at Boston University’s School of Management. “Apple acquiring [Netflix] is intriguing and worthy of consideration if Apple indeed launches a full-fledged TV.”

Sally Mounts, president of Auctus Consulting Group, near Pittsburgh, thinks Apple can’t even consider buying Netflix. Her argument is that, “Apple’s driving force is cutting-edge technology, and Netflix’s driving force is two products, DVD rentals and video streaming.”

Mounts is convinced that should such an acquisition take place, “The two companies would have clashing objectives that would slow operations, confuse supply chains and bewilder Apple evangelists.”

Apple employees don’t want (or need) to manage a conglomerate, she added. “That’s not an optimal move for a company with such a solid reputation for introducing dazzling new technology products,” she said.

Read the full MarketWatch report here.