Netflix Case Study Analysis

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Netflix, Inc., (NASDAQ: NFLX) is an American provider of on-demand internet streaming media in the United States, Canada[5], and Latin America and flat rate DVD-by-mail in the United States. The company was established in 1997 and is headquartered in Los Gatos, California. It started its subscription-based digital distributionservice in 1999[6] and by 2009 it was offering a collection of 100,000 titles on DVD and had surpassed 10 million subscribers. On February 25, 2007, Netflix announced the billionth DVD delivery.[7] In April 2011, Netflix announced 23.6 million subscribers.[8] In summer 2011, Netflix announced they will expand into the European market, starting in Spain by 2012.[9] In September 2011, Netflix completed the launch of streaming-content services in Latin America by launching in the Caribbean, Mexico, Central and South America. Contents  [hide]  * 1 History * 2 Services * 2.1 Internet video streaming * 2.1.1 History * 2.2 Disc rental * 2.2.1 Qwikster * 2.3 Original programming * 2.4 Profiles * 3 Device support * 3.1 Hardware supported * 3.2 Software support * 3.3 Video game consoles * 3.4 Set-top boxes * 3.5 Blu-ray Disc players * 3.6 Televisions * 3.7 Handheld devices * 4 Sales and marketing * 4.1 Expansion * 4.2 Competitors * 4.2.1 Time Warner * 5 Finance and revenue * 5.1 2010 * 5.2 2011 * 6 Legal issues and controversies * 6.1 Recommendation Algorithm * 6.2 Throttling * 6.3 Releasing This Week * 6.4 Dynamic queue, subscription & delivery methods * 6.5 Removal of Friends feature * 6.6 Linux support * 6.7 Partnerships * 6.7.1 Starz * 6.7.2 DreamWorks * 6.8 The CW * 6.9 Closed captioning * 7 Technical details * 7.1 Streaming * 7.2 "Throttling" * 7.3 Netflix API * 7.4 IT infrastructure * 8 See also * 9 References * 10 External links| -------------------------------------------------

[edit]History

Netflix headquarters in Los Gatos
Netflix was founded in 1997 in Scotts Valley, California by Marc Randolph[citation needed] and Reed Hastings, who previously had worked together at Pure Software, along with Mitch Lowe. Hastings was inspired to start the company after being charged late fees for returning a rented copy of Apollo 13 after the due date.[10] The Netflix website launched in April 1998 with an online version of a more traditional pay-per-rental model (US $4 per rental plus US $2 in postage; late fees applied).[11] Netflix introduced the monthly subscription concept in September 1999,[12] then dropped the single-rental model in early 2000. Since that time the company has built its reputation on the business model of flat-fee unlimited rentals without due dates, late fees, shipping or handling fees, or per title rental fees. Netflix developed and maintains an extensive personalized video-recommendation system based on ratings and reviews by its customers. On October 1, 2006, Netflix offered a $1,000,000 prize to the first developer of a video-recommendation algorithm that could beat its existing algorithm, Cinematch, at predicting customer ratings by more than 10%.[13] "Some 35,000 different film titles are contained in the 1 million DVDs it sends out every day."[14] Netflix has played a prominent role in independent film distribution. Through a division called Red Envelope Entertainment, Netflix licensed and distributed independent films such as Born into Brothels and Sherrybaby. As of late 2006, Red Envelope Entertainment also expanded into producing original content with filmmakers such as John Waters.[15] Netflix announced plans to close Red Envelope Entertainment in 2008, in part to avoid competition with its studio partners.[16][17] Netflix initiated an initial public offering (IPO) on May 29, 2002, selling 5,500,000 shares of common stock at the price of US $15.00 per share. On June 14, 2002,...
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