Netflix Stock Evaluation

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Netflix (NASDAQ: NFLX) forever altered the movie rental market in 1998. By doing as a lot of businesses were at the time, they took full advantage of internet retail. Blockbuster, the international video and game rental hub, was suddenly in turmoil. In 2004, they attempted to counter back with a Blockbuster Online ploy, but to no avail. Netflix, now with over 15 million subscribers, is the largest service for movies and TV series in the world. The ability to adapt and accurately predict progress in technology and consumer needs has allowed Netflix to continue to grow. In August of 1997, Reed Hastings (CEO) began the initial steps to make Netflix a success. Hastings incorporated Netflix on the idea of a conventional rental business with online services. Netflix’s internet store opened in April 1998, but did not offer the subscription option until September of 1999. The speedy growth of Hastings’s Netflix can be linked to two things: relationships and marketing ploys. The critical relationships with home theater and DVD player manufactures such as Sony, Toshiba, Pioneer, and Panasonic served as a foundation for success. Similarly, marketing ploys built a strong brand association with the consumer base. Netflix made a monumental move for their company in December 1999 by eliminating due dates, late fees, and shipping fees. Two years later in, on May 22nd, 2002, the initial public offering for $15 a share at 5.5 million, was made. In the fiscal year of 2003, Netflix reported its record revenues of $272.2 million, also the first profitable year. This was a 78% increase from 2002. A new service was added, an instant streaming service named “Watch Now” in January 2007. In February 2007, Netflix delivered its one billionth DVD. They celebrated by awarding a lifetime subscription to Netflix. On January 14th, 2008, Netflix rewarded its subscribers with unlimited streaming on their computers with no additional charge. In July 2008, Netflix entered a partnership with

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    1.
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Netflix;
pioneered
online
DVD
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(instead
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want
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 VOD.
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2007
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 ­
agremeent
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costs,
higher
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distrbution
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 OR
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