Why Netflix will have a tough time in China

The incentive is obvious: China is the world's third largest market for entertainment and media, according to Pricewaterhouse Coopers, and could be worth as much as $214 billion by 2018.

But many global firms have had a tough time getting their foot in the door: Google (GOOG), YouTube and Facebook (FB, Tech30) have been shut out of the country.

Here are three reasons why entering China is going to be a huge headache for Netflix (NFLX, Tech30).

1. It's not free

Chinese consumers aren't used to shelling out cash for content. Most streaming services in China rely on advertising, so Netflix's subscription service could meet with resistance.

"Consumers have historically paid little or nothing for traditional content, and have easy access to pirated digital content," according to Ernst & Young. "This environment has limited opportunities to generate multiple sources of income."

2. Censorship

The government keeps a tight grip on the number of foreign movies allowed into China each year, and screens them for content deemed controversial. It's likely that all Netflix content would have to be vetted before it could be made available in China.

Netflix content could be banned or censored, and the company could face tricky decisions over whether to bow to government censors or risk being blocked.

Related: China crackdown makes it harder to get around the Great Firewall

3. Competition

The market is already crowded with international and homegrown rivals.

Last December, Tencent (TCEHY) struck an exclusive deal to distribute Sony's (SNE) music library, including artists such as Beyonce and Yo-Yo Ma, online in China. Alibaba (BABA, Tech30) took control of film production company ChinaVision Media last year, and has invested $1.2 billion in Internet television company Youku Tudou (YOKU).

Alibaba has also invested in Xiami.com, one of the biggest local music service providers.

Other foreign firms are also trying to get in the game through distribution agreements. They include Warner Music, HBO -- owned by Time Warner, (TWX) parent of CNN and this website -- National Geographic, and YG Entertainment, the Korean pop label that backs singer Psy of "Gangnam Style" fame.

Related: Why Tencent wants to own Beyonce online

CNNMoney (Hong Kong) April 16, 2015: 9:45 AM ET

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Bill O'Reilly 'surprised' by attack on his credibility

"I was caught by surprise on it," O'Reilly told the Los Angeles Times.

"I was an idiot for not being prepared for it before a presidential election," he told the paper.

O'Reilly said the firestorm involving "NBC Nightly News" anchor Brian Williams should have given him a clue that he'd soon be embroiled in a similar dispute.

Related: How Brian Williams' Iraq story changed

Williams was suspended for six months without pay in February after he owned up to repeatedly telling an exaggerated story about his time covering the Iraq War in 2003. Williams has admitted "misremembering" the Iraq incident in which he was in a helicopter that got shot down. NBC is currently conducting an internal investigation into other Williams stories. His future at the network remains in doubt.

Days after the Williams scandal bubbled to the surface, the liberal magazine Mother Jones published a report indicating that O'Reilly had told his own exaggerated story about his time in Argentina covering the 1982 Falklands War. O'Reilly has repeatedly claimed to have covered the conflict in a "war zone," despite the fact that he reported from Buenos Aires -- far from the fighting in and around the Falkland Islands.

O'Reilly mounted a furious defense, disparaging the Mother Jones authors and insisting that his accounts were accurate.

More questions surfaced about some of his other claims, and eventually he was forced to clarify that he hadn't actually witnessed atrocities while covering the civil war in El Salvador and "The Troubles" in Northern Ireland. Instead, he saw photos depicting violence from each conflict. And O'Reilly still hasn't offered an explanation about evidence that contradicts his claim to have been at the scene when an associate of Lee Harvey Oswald committed suicide in the late 1970s.

Related: Phone recordings contradict O'Reilly's claims

O'Reilly told the Los Angeles Times that Williams is "definitely going to come back" to NBC, even if he doesn't return to the "Nightly News" anchor chair.

He made a nearly identical point in his interview with the Los Angeles Times.

"I put out what we had and said, 'Hey, what ever happens, happens,' " he said. "And luckily, the folks rallied."

CNNMoney (New York) April 16, 2015: 11:14 AM ET

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Gap between richest universities and the rest got wider

That's thanks to strong investment returns and a tremendous fundraising advantage, according to credit rating agency Moodys.

Eighteen of the wealthiest schools have Aaa credit ratings -- that's a rare achievement for any businesses or government.

The top 40 include seven of eight Ivy League schools - all but Brown University - along with prestigious institutions such as Stanford, MIT and Duke. But half of the wealthiest schools were state schools, led by the universities of Texas, California and Michigan.

Related: How I got into an Ivy League school

The 40 richest schools have median cash and investments of $6.3 billion, versus only $273 million for the 500 other schools tracked by Moody's. Harvard is the richest school with $42.8 billion assets, followed by the University of Texas at $36.7 billion. The University System of Maryland is at the bottom of the list with assets of $3.4 billion.

The richest schools had average investment returns of 50% between 2009 and 2014. Returns for other schools were between 22% and 38% over the same period.

The top 40 also collected 59% of all donations made to the 500 schools during fiscal year 2014.

Related: Stanford offers free tuition to families making less than $125,000

The result: About one third of the assets held by all colleges belong to the top 10 schools, and nearly two-thirds of the assets are held by the top 40 schools.

"This growing gap will pose increasing competitive challenges for institutions that do not have the resources to invest in facilities, financial aid, and other strategic initiatives at the same level as their wealthier counterparts," said the report.

Related: 10 most expensive colleges

CNNMoney (New York) April 16, 2015: 11:50 AM ET

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Kansas gov to sign sweeping welfare crackdown

The measure - believed to be the strictest in the country - concerns the Temporary Assistance for Needy Families program in Kansas, which is designed to help families struggling with short-term financial hardships.

The TANF program provides families with benefits cards that can be used like a debit card to purchase groceries and gas or pay for things like rent and day care.

Under the new law, recipients will be unable to use the card to purchase alcohol, tobacco and lottery tickets. They will also be barred from using the card in nail salons, in swimming pools and for fortunetellers. (See full list below).

It is difficult to track how much cash assistance is spent on items that will be banned, but a federal report last year found that less than one percent of total aid was used at liquor stores, casinos or strips clubs, according to the Associated Press.

The federal government has required states to restrict TANF recipients from using their cards in liquor stores, gaming or gambling establishments or adult entertainment venues.

At least 23 other states have passed laws restricting how benefits cards can be used, according to the National Conference of State Legislatures.

In Alabama, for example, the cards cannot be used to pay for psychics or for body piercings. Indiana prohibits the cards on riverboats and other gambling facilities, as well as in gun stores.

TANF recipients in Kansas will still be able to use their cards in gun stores.

Related: Student loans forgiven for daughter of fallen vets

The legislation, called the HOPE Act, enshrines in law various changes the Brownback administration has made to the program over the past few years. Supporters said putting those changes into law will make the harder to repeal down the road.

Brownback's office says the changes have helped 6,100 recipients find jobs and transition out of the program last year.

In one of its more controversial aspects, the bill limits the amount of money TANF recipients can withdraw from the ATM to $25 per day. Previously, there was no limit on how much cash could be taken out. On average, TANF families receive about $400 per month.

TANF recipients will still be able to obtain money orders using their TANF dollars, which can be used to pay for rent or other bills that cannot be paid by card.

Related: Will Hillary Clinton support a $15 minimum wage?

Supporters of the bill have acknowledged that policing how recipients spend their $25 will be difficult, if not impossible. But the goal, they say, is to prevent people from gaming the system, rather than punishing families that have fallen on hard times.

Still, critics say the legislation mischaracterizes the majority of TANF recipients, who are largely single parents who don't earn enough to pay all their bills.

Kansas Action for Children, a local advocacy group, said in a statement that the law will make it harder for poor families to access other support programs, including the Supplemental Nutrition Assistance Program, or food stamps.

"By signing this bill into law, Gov. Brownback has added to the burden that the poorest Kansans already carry," the KAC statement said. "It's always been hard to be poor in Kansas. Now, it's going to be a lot harder."

In Kansas, here's a list of what would be off limits:

Alcoholic beverages

Casinos

Gaming establishments

Jewelry stores

Tattoo parlors

Massage parlors

Body piercing parlors

Spas

Nail salons

Lingerie shops

Tobacco paraphernalia stores

Vapor cigarette stores

Psychic or fortune telling businesses

Bail bond companies

Video arcades

Movie theaters

Swimming pools

Cruise ships

Theme parks

Dog or horse racing facilities

Parimutuel facilities (off-track betting)

Cigarettes and tobacco products

Lottery tickets

Concert tickets

Tickets for professional or collegiate sporting events

Tickets for other entertainment events intended for the general public

Sexually-oriented businesses

Strip clubs

Any business or retail establishment where minors under age 18 are not permitted.

Related: Women nearly twice as likely to retire in poverty

Related: How your tax dollars are spent

CNNMoney (New York) April 16, 2015: 12:34 PM ET

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Russia bans 'Child 44' serial killer movie

Gary Oldman and Tom Hardy star in the Lionsgate thriller "Child 44."

The ministry of culture in Moscow has blocked distribution of Hollywood thriller "Child 44" for being "historically inaccurate."

The Lionsgate (LGF) movie is about a Soviet-era serial killer. Oldman plays General Mikhail Nesterov, an officer who tries to hunt down the killer.

It was due for worldwide release Friday but now won't be seen in Russian theaters.

The ministry said the film, which also stars Tom Hardy and Noomi Rapace, distorts historical facts and events before, during and after World War II.

Russia is preparing to celebrate the anniversary of victory over Nazi Germany next month.

"The distribution of such films on the eve of the 70th anniversary of the Great Victory is unacceptable," the ministry said.

Culture minister Vladimir Medinsky accused the filmmakers of depicting Russia as a "Mordor" -- the evil realm of Tolkein's "Lord of the Rings" -- with "physically and mentally inferior subhumans."

Related: Putin wants Russian films to be about Crimea and military glory

The film was due in hundreds of cinemas across Russia after premiering in London on Friday. Central Partnership, the Russian distributor, said the decision to withdraw the film was made jointly with the ministry of culture.

Based on a 2008 bestseller by Tom Rob Smith, the movie transposes a series of murders committed in the 1980s to famine-stricken Stalinist Russia. It shows the authorities trying to cover up the crimes to maintain the image of a perfect society.

Related: Even bribes are more expensive in Russia

CNNMoney (London) April 16, 2015: 9:24 AM ET

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Elizabeth Warren: Tax the banks

The Massachusetts Senator is calling for changes in tax law designed to hit banks where it hurts: executive compensation, leverage and high-frequency trading.

In a speech Wednesday in Washington, Warren, a Democrat, charged that Republicans are hindering the implementation of reforms put in place after the 2008 financial crisis. But she was equally hard on government regulators, including the Securities and Exchange Commission, Department of Justice and Federal Reserve.

"The bottom line is that the culture of cheating on Wall Street didn't stop with the 2008 crash," she said. "When cops don't do their job, cheaters prosper and honest businesses lose out."

Related: 'Wealth trickles up,' says Warren

Warren reiterated that banks deemed too big to fail need to be broken up. She wants to force financial firms that have federal deposit insurance to be limited to "boring banking." Banks that want to take risks are free to do so, she said, but taxpayers should not be on the hook for their mistakes.

Warren also called on Congress to limit the Federal Reserve's ability to provide emergency loans to banks that get into trouble, saying Wall Street sees the Fed as its "personal piggy bank."

In addition, she wants the Department of Justice to stop offering "deferred prosecution" agreements to banks that break the law, which she compared to a "slap on the wrist," and a request to "please don't do it again."

But making the financial system safe and fair will also require changes to the tax code, Warren said.

Related: Elizabeth Warren is worth millions

Under the 2010 Dodd-Frank financial reforms, the SEC has the power to regulate executive compensation, but the commission has yet to finish writing those rules.

"The SEC needs to get its act together," said Warren. "But we can't sit on our hands on this issue any longer."

Warren said corporations are taxed for any executive compensation over $1 million, unless it is in the form a "performance-based bonus," which makes up the bulk of most CEO pay. Closing this loophole, she said, would "stop pushing companies to reward short-term thinking."

Warren also wants to change tax laws that she says give financial firms an incentive to take on debt, rather than raising capital in the stock market.

Related: Elizabeth Warren has 8 ways to restore the middle class

"Financial firms can write off every dollar of interest they pay on their debts, but financing themselves thorough equity requires them to pay taxes on dividends," she said.

Warren called for a transaction tax on firms that use computer-based trading systems to make rapid-fire transactions. She said taxing so-called high-frequency trading would make the market less volatile and give smaller investors a fighting chance.

"Together, changes like these can make a real difference," Warren concluded. "They can help protect hard-working families from cheats and liars. They can help rein in the lawless practices that are still too common on Wall Street."

Related: Elizabeth Warren brings new fight for middle class

Related: Elizabeth Warren says the market is broken

CNNMoney (New York) April 16, 2015: 9:27 AM ET

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Netflix stock tops $500 for first time ever. Next stop = $900?

The company is on fire. One analyst now predicts Netflix (NFLX, Tech30) could hit $900 a share by next year. The reason? Millennials (and a lot of other age groups) talk about watching Netflix, not TV.

"Netflix subscribers -- nearly 40% of TV households in the U.S. -- love the service more than TV," Barton Crockett, an analyst at FBR Capital Markets, wrote in a note.

That shift is helping the bottom line. Netflix crushed its earnings Wednesday. It added 4.9 million subscribers in the first quarter this year, well above the 4 million it added in the same quarter a year ago. The stock shot up 15% Thursday morning and is the best performer by far this year in the S&P 500.

Related: Netflix wows Wall Street with strong subscriber growth

The Netflix migration: FBR and ClearVoice Research conducted a survey to ask Netflix users what they thought of it. Half said they spend more time on Netflix than traditional TV, and 57% said they like Netflix more than TV. Not bad for a company that opened for business in 1998.

The survey results were one of the main drivers for Crockett to update his projection that the stock could shoot to $900.

Investors and analysts aren't just giddy about Netflix's potential among Americans -- its user base abroad is expected to grow by a lot too.

While Netflix gained 5.8 million users in the U.S. over the past year, it got 8.2 million new subscribers abroad over the same time. Netflix is also one of the first American companies to operate in Cuba, which it reported during the quarter.

Other analysts raised their one-year price estimate for Netflix, but not nearly as much. Earlier this week, Cantor Fitzgerald raised its estimate on Netflix to $500 -- which Netflix quickly surpassed Thursday.

Related: Why Netflix will have a tough time in China

Headwinds: The only drag for Netflix these days is the strong dollar. All the foreign growth for the streaming service means Netflix must exchange those profits abroad into U.S. dollars. That's been problematic lately as the dollar keeps going up in value. Netflix actually missed earnings estimates, but investors are shrugging it off since it was mostly caused by the dollar's surge. That should dissipate over time.

The bigger concern long-term for Netflix is the rise of other streaming services. You can now sign up for HBO, for example, without needing a cable subscription. But Netflix is starting from a huge position of strength.

Related: How to invest $1,000

Related: Goldman Sachs employees made nearly $130K in 1st quarter

Related: Star Wars,' Marvel, and 'Game of Thrones' have cut the cord

CNNMoney (New York) April 16, 2015: 10:47 AM ET

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Finally! Saudi Arabia opening stock market to foreigners on June 15

The oil-rich nation is opening its stock market -- the largest in the Middle East -- to foreign investors on June 15, the government announced Thursday.

The Saudi market -- worth an estimated $530 billion -- is more than double the size of the Tel Aviv stock exchange in Israel.

Previously, only Saudi-based investors could buy stocks there. By mid-June, international firms will be able to buy stocks in the country's exchange, the Tadawul All Share Index. This will likely encourage mutual funds and ETFs to add some Saudi stocks to their holdings, especially in emerging market funds.

Related: Saudi Arabia: The next big emerging market?

The move could put Saudi Arabia in the same breath as major emerging market countries like Brazil and India, although it's still classified as a "frontier market" currently.

The Saudi market is largely dominated by energy-related companies and financial firms. The index is up 11% so far this year.

Saudi Arabia's international market opening comes on the heels of China making it easier for foreign investors to buy Chinese stocks in November.

Related: Investors send billions to Shanghai as market opens to foreigners

CNNMoney (New York) April 16, 2015: 11:51 AM ET

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Jorge Ramos breaks through, making the cover of Time 100

The Fusion and Univision anchor made one of the covers of Time's 100 most influential people.

The veteran newsman may be somewhat unknown to English language audiences, but his respected stature in the media world and in the Hispanic community helped him make Time's cover. Time printed five covers; the other names were Supreme Court Justice Ruth Bader Ginsburg, musician Kanye West, dancer Misty Copeland, and actor Bradley Cooper.

Ramos, who was born in Mexico City, appears on Spanish-speaking news shows like Univision's "Notciero Univision" and "Al Punto," two of most widely watched Spanish language news shows. In addition, he hosts the English-language Fusion news show "America with Jorge Ramos."

The anchor has turned heads in the past year for his intense interview with President Obama regarding Immigration reform along with showing the hardships of immigrants by swimming across the Rio Grande with his camera crew.

Ramos, 57, has been often called the "Walter Cronkite of Latino America," according to the New York Times. Yet, making the cover of Time 100 is a breakout moment for the anchor and his young Fusion network.

Fusion, Disney (DIS) and Univision's cable network looking to serve Millennials across differing platforms, was launched two years ago and, like Ramos, is fairly undiscovered.

Regardless of its current impact, Ramos has spoken highly of Fusion telling CNN's Brian Stelter in September that the media company was "a bridge to the future."

"In 2016, no one is going to be able to make it to the White House without Fusion or Univision," Ramos said speaking to the network's reach to Latino audiences.

In the Time 100 piece on Ramos, the anchor received glowing words from fellow journalist CNN's Christiane Amanpour . "He says he asks every question as if it's his last, determined to get an answer or go down trying," wrote Amanpour. "He knows he has a voice and is not afraid to use it."

Ramos has won multiple awards for his work and is considered by many in the media landscape to be one of the most influential journalists heading into the 2016 election, and Fusion and Univision have worked hard to promote Ramos as a news anchor for the future. His inclusion in the Time 100 is a boost for Fusion's standing.

"With another presidential election coming up, if anyone can move this needle, Jorge Ramos can—and he must," Amanpour added.

CNNMoney (New York) April 16, 2015: 12:11 PM ET

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Let's get this party started: Party City goes public

Wall Street seems to think good times are rolling for Party City (PRTY), which is the largest party goods retailer in North America.

It debuted on Thursday morning at $20.50 a share. That's more than 20% above its initial public offering price of $17 on Wednesday night.

The coming out party was held at the New York Stock Exchange, where Party City is now trading under the ticker symbol "PRTY." The IPO values the retail chain, which sells everything from balloons and pinatas to costumes, at nearly $2 billion.

Etsy (ETSY), the online marketplace for vintage and handmade goods, also began trading Thursday, making it the largest certified socially-responsible company, or B Corporation, to go public in the U.S.

Rounding out the IPO party Thursday was Virtu Financial (VIRT), a high-frequency trading firm that had its public debut delayed by a year due to the controversy sparked by the Michael Lewis book "Flash Boys," which argues that U.S. markets are rigged by high-frequency traders.

Related: Etsy crafts a $267 million IPO

Too much debt? The Party City deal raised $372 million, but the company doesn't plan to do anything wild and crazy with the proceeds.

The cash will be used to help pay down its heavy debt burden, much of which was incurred when Thomas H. Lee Partners took a majority stake in the company in 2012. The private-equity firm now owns a smaller stake in Party City, though it remains a majority shareholder.

While some investors may be alarmed by Party City's more than $3 billion in debt, management isn't concerned.

"It is a lot of debt, but we've operated in a highly-leveraged environment for a long time," Party City CEO Gerald Rittenberg told CNNMoney, noting the chain's first leveraged buyout took place in 1997.

Rittenberg said Party City's business is "very, very stable" and features "great cash flow characteristics." He pointed to how even in 2009 during the Great Recession same-store sales only fell 2.9% and the company still posted a profit before interest, taxes and other expenses.

Related: Netflix stock tops $500 for first time ever. Next stop = $900?

The party is growing: Party City offers a way for investors to capitalize on the $10 billion retail party goods industry, which lures lots of customers during special occasions like Halloween, Fourth of July and the Super Bowl.

Get ready to see more Party City stores. The chain already has 900 locations, but it sees an opportunity to open another 350 stores in North America and ramp up expansion overseas as well.

If the banks underwriting the Party City IPO exercise their options, the total value of the IPO will rise to $428 million.

Related: GoDaddy races onto Wall Street with IPO

Related: How to invest $1,000

CNNMoney (New York) April 16, 2015: 12:43 PM ET

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