Netflix stock jumped up 5.66% today on rumors that the company may be in acquisition talks with by Amazon. The funny thing about public company rumors: when they affect stock prices, it becomes AP-reported news.
Netflix has been under attack from Blockbuster and others in recent years, although membership growth has remained steady and the company is profitable. A whole new class of competitors are emerging, though, that facilitate legal movie downloads. Netflix has entered that market as well, but at a cost of $40 million per year in licensing fees. It may be time to throw in the towel.