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BUS 219 Netflix Final Paper

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BUS 219 Netflix Final Paper
Everybody knows, world-wide, about Netflix and that it is an online based company that a paid subscriber can go to, to watch movies, TV shows and original content produced by Netflix. A customer can either stream the media directly to their computer or handheld device or, select DVD’s to be delivered to their home. The most popular way to access Netflix is to stream media on a PC or handheld. Have you ever wondered how Netflix decides what to suggest for you to watch? What you might not know is that it’s actually an innovative algorithm that starts suggesting items for the viewer once they’ve watched something. This is so the customer doesn’t have to spend time finding something for their selves. By using that data, they build a more personalized experience for their customers.
They use that same algorithm to predict what is going to be popular and how much stock they will need. This maximizes profits by preventing the storage centers from overstocking on movies that will be in lower demand. Netflix has several distributions centers across the globe; this also helps to maximize their profits because they do not have to maintain individual store locations. This paper will explain how Netflix’s use of this algorithm and data analysis supports their competitive advantage and differentiation strategy.
Netflix and their networks connectors have recently been in the news. In February, Netflix and Comcast signed a deal regarding Netflix’s privilege of connecting networks, known as “peering,” to improve their data-intensive services. In April, Netflix and Verizon reached an interconnect arrangement that will provide better internet service and improved performance to Verizon’s and Netflix’s mutual customer base.
Unfortunately for Verizon customers that are Netflix users, they have been subjected to terrible service speed. In March of 2014, Netflix released an ISP Speed Index that placed Cablevision-Optimum as providing the top average speed. Comcast and Time Warner


Cited: Aaron, Bay. "Behind the Scenes at Netflix." Weblog. Wordpress.com, 7 May 2010. Web. 29 April 2014. <http://ripmacdre415.wordpress.com/2010/05/07/behind-the-scenes-at-netflix/>. Abbruzzese, Jason. "Netflix Agrees to Pay Verizon for Peering." Mashable. Mashable, 28 Apr. 2014. Web. 30 Apr. 2014. <http://mashable.com/2014/04/28/verizon-peering-netflix-comcast/>. Abbruzzese, Jason. "Netflix and Comcast Continue War of Words Over Internet Traffic." Mashable. Mashable, 24 Apr. 2014. Web. 30 Apr. 2014. <http://mashable.com/ 2014/04/24/netflix-comcast-square-off/>. Indvik, Lauren. "Netflix to Launch in the Netherlands." Mashable. Mashable, 19 June 2013. Web. 30 Apr. 2014. <http://mashable.com/2013/06/19/netflix-netherlands/>. "Netflix Competitive Advantage." Zkometani11s Blog. Wordpress.com, 2010. Web. 29 April 2014. <http://zkometani11.wordpress.com/netflix-competitive-advantage/>. "Netflix." Mashable. N.p., 2013. Web. 01 May 2014. <http://mashable.com/category/netflix/>. "Open Connect - Hardware." Netflix Content Delivery Network. Netflix, 2014. Web. 01 May 2014. <https://www.netflix.com/openconnect/hardware>. "Open Connect - Software." Netflix Content Delivery Network. Netflix, 2014. Web. 01 May 2014. <https://www.netflix.com/openconnect/software>.
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