Netflix and the Use of Ecommerce

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TO: Bus 311, Summer I, 2010

FROM: Group 6.3

SUBJECT: Report on NETFLIX

This report was written under the assumption of complete satisfaction of requirements for Business 311, Information Systems in Global Business Environment, Summer I, 2010, University of Hawaii at Manoa. An analysis of Netflix in Information Systems indicates that the company has been able to use technology and ecommerce in a method that has created a billion dollar entity. Netflix has been successful by improving the movie rental business with the embracing of changing technology and consumer preferences that has revolutionized the way people view movies. Netflix is a company that has shown the power of ecommerce and the success it can bring to businesses that are willing to adopt it. *If you have any question about this report please contact any of us at the email addresses or phone numbers listed above. Thank you.

Use of Ecommerce
in
Netflix, Inc.

By

Group # 6.3

Summer I, 2010

Executive Summary
Netflix has in the past decade revolutionized how Americans rent and view movies. This process of ordering movies online and receiving them in the mail proves that this innovation has been able to adapt to the ever growing technological world we all live in. The ability to be cheap, convenient, and appeal to a vast audience has given Netflix the biggest advantage in the movie rental business. The wide availability of Netflix and a strategic sending and receiving system has ensured the success of the company.

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OUTLINE

Executive Summary . . . . . . . . . . . . . . . . . . . . . . ……………………i

Outline ……………………………………………………………… ii

Introduction …………………………………………………………1

Theoretical ………………………………………………………….
Technical ……………………………………………………1
Economic …………………………………………………... 2
Political/Legal ………………………………………………2
Social/Cultural ……………………………………………...3

Practical …………………………………………………………….
People ……………………………………………………...4
Procedures …………………………………………………5 SW …………………………………………………………6 HW …………………………………………………………7

Discussion …………………………………………………………

Summary ………………………………………………………….

References ………………………………………………………..

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Introduction
Established by Marc Randolph in 1997 and with its headquartered in Los Gatos, California, Netflix (NASDAQ: NFLX) was a movie rental start up that sought to bring the movies to the people via mailing. Netflix's subscription service was started in 1999. In 2009 it was offering a collection of 100,000 titles on DVD and surpassing 10 million subscribers, although originally it lost money until 2003 when it posted its first profit $6.5 million. Now it services a host of subscribers numbering in the area of 14 million and streams it movies through numerous entertainment devices. Technical:

The way that Netflix incorporates technology is through the use of the internet, postal service delivery, commercials and ads. The company also uses large servers to store their streaming movie files. According to company’s chief executive officer, they “named their company Netflix in 1998 because they believed Internet-based movie rental represented the future, first as a means of improving service and selection, and then as a means of movie delivery.

Netflix subscribers may now view movies over a large variety of digital devices. Some examples of these are video game consoles, Set-top boxes, Blu-ray players, televisions and handheld devices that key into either mail-in (CD and/or Blu-ray discs) or Internet streaming which uses a VC-1 format.  VC-1 is the informal name of Society of Motion Picture and Television Engineers (SMPTE) 421 M video codec standards, which was initially developed as a proprietary video format by Microsoft before it was released as a formal SMPTE standard video format on April 3, 2006. It is today a widely supported standard found in HD DVDs, Blu-ray Discs, Windows Media Video 9, and Microsoft's...
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