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evolution_of_netflix.pptxThe Evolution of Netflix
Christian Kincaid
Company Overview
Founded in 1997
Reed Hastings is the founder and current CEO
DVD/Blu-Ray Rental and Streaming Service
$6.77 billion in revenue in 2015
Over 75 million subscribers (44 million US)
The Netflix Success Strategy
Start Small
Fail Quickly
Think Big
Scale Fast
Start Small
Started out with 30 employees and 925 titles available to rent
Used traditional rental fees starting out, but quickly moved to subscription service
Thanks to copyright law, Netflix was allowed to buy its DVDs in a retail store and rent them out
Start Small
Revolutionized the movie/TV rental service
Drove rental costs down which put brick and mortar rental stores like Blockbuster out of business
After a short time Netflix was the largest customer of the US Postal Service sending out over 1,000,000 movies daily
Fail Quickly
Hastings believed streaming would be the future
Set up several small tests to offer streaming video in the early 2000’s
Adopted the wait-and-see method in their approach to video streaming
Think BIG
Began investing in internet streaming service as early as 2001
Started including their new streaming service as a part of DVD subscriptions in 2007
Allowed them to get people used to streaming without jumping in headfirst
Think BIG
Envisioned a television landscape where our content was viewable around our schedule instead of vice versa
Knew the internet would become integral to our everyday lives and that entertainment industry would have to migrate
Scale Fast
The improvement of technology enabled Netflix to increase its user base
In 2010 Netflix streaming had grown so rapidly that they were able to release a standalone streaming subscription
No longer confined to the computer
Scale Fast
Netflix had shifted from being the largest customer of the postal service to being the largest source of internet traffic in the US
Netflix released its first original program, House of Cards, in 2013
By the end of 2016 Netflix will have over 100 original programs
Innovation
Changed the way we rent movies
Pioneered internet streaming
Innovation
Extremely personalized for every user
Use a recommendation algorithm to recommend TV shows and movies to fit each user’s specific taste
Recommendations now account for 60% of their content viewings
Innovation
Have volume with original content as well as quality
Netflix original content has received more than 200 nominations and awards for their original programming
Innovation
4K UltraHD was introduced in 2014
Netflix is the leading creator of 4K content
In late 2016, Netflix will roll out High Dynamic Range (HDR)
Sources
http://www.forbes.com/sites/petercohan/2013/04/23/how-netflix-reinvented-itself/#73fecb2874ea
http://www.forbes.com/sites/chunkamui/2011/03/17/how-netflix-innovates-and-wins/#7aed66f0b69a
http://ir.netflix.com/long-term-view.cfm
http://www.stuff.tv/features/why-its-time-get-pumped-about-hdr-television
