I'll take exception to the word, "Does anyone KNOW", as I doubt if anyone here does KNOW their capacity. If I were to answer by totally guessing I would say now, today, with the # employees, inventory, DCs, hardware and software, maybe not over 30k believing have about 10k now. BUT, if asked can they expand quickly to satisfy programmed demand, the answer is that IMO they can. They have said they can open DCs quickly. They can certainly hire people to service the incoming and outgoing dvds, and there appears to be an ample supply of dvds availble to increase their inventory. Inadequate as it is, we've been told the mechanics of the web-site are in place for any increase in the numbers. We've been told they have funds on hand, in the bank, not held by GGI, to operate over the next several months. To me that would indicate they can buy inventory. Now, throw 10,000 new subs at them tomorrow and they would probably bog down badly (but still recover with a lot of O/T). But give them the opportunity to grow at 10,000 a month and can probably make it OK. IMO the programmed 55 stores per month was an exceptionally good idea with CC. Figuring todays growth at an estimated 2,000 subs. per month (my figures, no source, just a gut feeling). About 1,700 from the 17 stores and 300 from the web site, no problem. Then add 6,000 additional each month for the 55 new stores, in addition to how many they had at the end of the prior month, and I figure they could have 100,000 subs by next December with profitability starting back in the 2nd quarter. They have always said they want to stay lean and trim, a SW Airlines, not a United. Not willing or desiring to become as large as NF but be profitable even before NF. BBI threw a whole bunch of money away trying to catch NF and look what has happened. WalMart, the giant, dropped out of on-line throwing their's to NF. Read an article where McDonald's Red Box (IMO a very good idea) may not show a profit for a very long time, if ever.
Now, if we were to change the mix, with NetFlix renting games also for the same cheap price, we may be hard pressed to grow as fast but would still be profitable as long as we give good service.
Enough said. JMHO in every respect.
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