Netflix (NASDAQ: NFLX) has been a strong performer of late as its affordable home entertainment option proves itself to be recession-resistant.

But I'm still skeptical. As I've written in the past, Netflix's DVDs by mail business will not be viable after technology progresses beyond a certain point. Will they come in three years, five years, or ten years? Who knows, but long term, the company's ability to remain at the forefront of video delivery technology -- and its ability to deliver it at at profit -- is what matters.

The Wall Street Journal's Heard on the Street column (subscription required) raises questions about the viability of Netflix's digital delivery business. Numerous other companies are also racing for market share in the growing category and, according to the Journal, "the sheer cost of acquiring online-viewing content could crush Netflix's profit margins, unless the company sharply raises its subscription price, thereby reducing a key advantage over rivals."

Given that the majority of movie studios make their money on sales of DVDs and television licensing deals, Netflix would likely have to fork over a huge percentage of its revenue if online movies overtake DVD sales.

The stock appears to be pretty expensive for a company with such uncertainty surrounding its future viability.