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Netflix (NFLX) CEO Cares About the Wallet of Short Seller Tilson, Tries To Convince Him to Cover

December 20, 2010 8:20 AM EST Send to a Friend
Netflix (Nasdaq: NFLX) CEO Reed Hastings issued an open letter at SeekingAlpha responding to short seller Whitney Tilson, trying to persuade him to cover his short. Hasting jokes that he wants Tilson to have more money to donate to causes.

Hasting said while Tilson only has to be right on one of the issues cited in his short thesis, he will likely be wrong on of all them.

Those potential issues cited by Tilson were: CFO's recent resignation; threats to the First Sale doctrine for DVDs; internet bandwidth costs potentially increasing; declining FCF conversion; market saturation; weak streaming content; paying more for streaming content; and increased competition hurting margins.

Hastings said while there are many risks ahead for Netflix and valuation is substantial "shorting a market leading firm as it is driving a huge new market is a very gutsy call."




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