It was truly the best of times and the worst of times for Netflix last week.The streaming service was rewarded with a whopping 54 Emmy nominations for its original programming, coming in third behind HBO and FX (whose stellar series, “The Americans” was finally recognized.)Netflix also introduced something called “Flixtapes”— playlists that users could put together and then share with their friends. (That this idea was also proposed in our book, “Over The Top. How The Internet Is (Slowly But Surely) Changing The Television Industry” should not go unnoticed.) This is the sort of innovation that keeps the pay TV networks and MVPDs feet to the fire. Not that it’s all that groundbreaking, but it’s simple and user friendly and oh-right-it’s-2016-not-1996 inducing.There was also a bit of good news about "Star Trek," the new CBS TV series, as Netflix obtained international rights to it everywhere but the U.S. and Canada. (That’s 135 countries, if we’re counting right. Beam me up Scotty indeed.)Just as they were getting ready to break out the champagne however, all hell broke loose.The latest subscriber stats came out and they were not good.  Really not good.Rather than the 2.7 million new subs Netflix was expecting, they only gained 1.7 million. And of that 1.7 million, a paltry 160,000 of them were in the United States. That’s about two football stadiums worth of new subscribers for an entire quarter.Wall Street promptly rewarded them for their hubris by sending the stock hurtling down by as much as 16%. And Reed Hastings was left scrambling, blaming the subscriber fall-off on the “media” who had clearly been talking way too much about the extra dollar Netflix was now charging subscribers who had previously been grandfathered in to the old $9.99/month rate.If only that were the case.In our estimation, Netflix has reached the saturation point. There are only so many people who want to subscribe to an extra TV service, especially one that focuses on reruns and original series aimed at educated blue staters. There’s technophobia too, as anyone who has ever had to explain to an elderly parent how a Roku works can attest.That’s not to say Netflix is done, stick a fork in them. Rather, Netflix needs to branch out, which they seem to be doing in their recent deal with Comcast, which we are betting will not be the last MVPD carriage deal they strike. They’ll need to make sure that marketing is a big part of those arrangements, so that Comcast is pushing deals like “Sign up now and get three months of Netflix free!”Another advantage of the MVPD deals will be a reduction in churn. Right now it’s way too easy to cancel a Netflix subscription, even if it’s for a few months. But just try to get in touch with your MVPD to cancel a service. A half hour in phone chain hell should cure anyone of their plan to drop Netflix for the summer. It’s not an ideal way to keep subscribers, but, as HBO and Showtime have learned, it’s quite effective.Netflix has made a pivot to shows with broader appeal, adding shows like “Fuller House” to their offering. The datameisters in charge of their platform no doubt have other plans to increase Netflix’s appeal (a broader movie catalog seems to be a no-brainer.) Netflix has traditionally appealed to a more affluent demographic, pay TV subscribers (not cord cutters) who feel that $1o/month is a fair price to pay for all that extra programming. Now the trick is to reach out to everyone else.We think Netflix is more than up for the challenge, which is why we feel that Wall Street is overreacting and that Netflix will continue to thrive, especially once all those MVPD deals are in place, as that should definitely help in reaching new audiences.