The Company Netflix Rental Service and Website
The company Netflix started in the year 1997 by the co-founders, Reed Hastings and Marc Randolph in Los Gatos, California . The company started as a way to offer online movie rentals. As the years went by and as technology started to advance so did Netflix. In the year 2007, Netflix introduced the idea of streaming. To be able to play a movie or show as much as you want, anywhere, as long as you are connected to internet changed the way of entertainment. As the company continued to grow so did its competitors. The future prospects for Netflix are projected to grow every year for the next couple of years.
In 1998, Netflix debuted their first mail DVD rental service and website. A year later people were able to sign up for a subscription to purchase unlimited DVD rentals. If anyone were to open their Netflix account right now. They will see that it’s personalized to them. Every show, movie anyone watches gets stored into their Netflix account. It has a recommendation algorithm that finds movies or shows one might be interested in based on what they have watched. On various shows and or movies people will be able to see a percentage showing the believed interest for watching the content. This recommendation algorithm we use today wouldn’t have been possible if it weren’t for Bellkor’s Pragmatic Chaos, a international team made up by seven computer scientists, mathematics and engineers. The company started a one million dollar contest called Netflix Prize in 2006 to see if anyone can improve its recommendation system by ten percent. Announcing the winner, Bellkor’s Pragmatic Chaos, on September 21,2009. Even though, Netflix does not use the same recommendation algorithm that won the contest it sure improved the ideas they had for the system and enhanced the company. In the next years Netflix went global. Around 2013, Netflix introduced their first original series called “House of Cards” which became very popular and have not been done before by any other streaming company.
Later, “Orange Is The New Black” also was introduced as a Netflix original and was nominated for 12 Emmy awards just after its first season. In 2016, Netflix aired their very popular Netflix original series, “Stranger things” and this show was nominated for many awards for various award shows. All this success wasn’t easy at first for the company.
Before Netflix, there was the company called Blockbuster, that offered rental and sales of movies and games through mail, in-store or online. It was founded by David Cook, and began in 1985. At first Cook, was in the business of supplying computer software services towards Texas oil and gas industry. But the company had gone bankrupt, and movie rentals were in high demand. He then decided to venture into a movie rental business which he named Blockbuster. Blockbuster in its starting years was very successful. Around the year 2000, Blockbuster made the biggest mistake. Reed Hastings ,the founder of Netflix, had offered CEO John Antioco of Blockbuster to purchase then small business known as Netflix for $50 million. After a long negotiation he passed up on the opportunity. John Antioco said that Netfix wasn’t doing very well at the time and dismissed him. A couple years later the company filed for bankruptcy. A major negative with Blockbuster was the late fees for movies and games which Netflix did not have. Now Netflix is the highest subscribed streaming company.With the competition of Netflix and Redbox, another movie rental service, Blockbuster had no chance. As Netflix advance their technology so did other companies which created competition.
Despite it’s great business Netflix’s major competitor is Amazon and said to be a threat to the company. Amazon, is one of the largest online shopping websites. It was first known for their wide selection of books then expanded into selling electronics, furniture, and more. In 2005, the company launched Amazon Prime offering consumers free-two day shipping. Later, Amazon included online streaming for movies and shows which then became a rival to Netflix. While Amazon has many things to offer alongside Netflix, it is said it won’t compare to the amount of streaming due to the many popular tv-shows Netflix has. Netflix also competes with Hulu, while both stream videos and movies. Hulu has present tv-shows and movies but with that comes ads, which many people dislike. Another streaming company named HBO, also streams a wide variety of present day and old content but with that comes with the negative of paying $15 a month. $15 a month is a lot for many people,while Netflix has cost plans, which starts with the basic plan of $7.99 a month and continues to go up based on the numbers of screens someone would want available while watching under one account. Surprisingly, Youtube is also a major competitor for Netflix. Youtube is one of the most visited sites online. It offers a wide variety of videos and gives individuals a chance to create their own. In 2014, Youtube had created their own premium plan called Youtube Red a paid subscription plan offering original content and streaming videos. This as well became a rival towards Netflix because so many people already have a Youtube account due to the fact that Youtube is a subsidiary to google. Now Disney can also be a rival towards Netflix. In 2019, Disney wants to create their own streaming company and pricing it lower. They will start pulling their Disney original movies and shows from Netflix. Which makes up a lot of their kids and family content. Regardless of the competitors Netflix is looking to do better and the company’s future looks promising.
The earnings for Netflix are said to grow in the future years. Netflix will have a good long term run and investors highly recommend investing in this streaming company. It is said that it’s earnings are going to be 33.47% for the next couple of years. The future prospects for Netflix are said that its growth of subscribers are expected to rise. Due to Netflix’s popularity towards to its original content like Stranger Things, they will be focusing more on making Netflix originals. And also building up their content selection to bring in different viewers from all of the world.Which will increase the expected 9.4 million viewers they wish to bring throughout the years. Netflix seeks to strike more deals with other streaming companies, like T-Mobile for example through a phone plan you will also get a Netflix plan.The company is also looking towards to improving their 4K plan which is the more expensive plan from all the rest starting at $13.99 per month. This plan offers high definition and new shows only under this plan. Due to Disney wanting to start their own streaming company, and since the company is going to pull all Disney original movies and shows from Netflix. Disney content is a majority of Netflix’s kids and family shows, Netflix says they will try their best to add more kids and family content. So they won’t experience a loss of subscribers. In the end Netflix isn’t suppose to have a stock drop anytime soon based on the great and expected business.
Netflix changed the way of entertainment forever with the introduction of streaming.To be able to watch movies or shows on your tablet, phone or television in the comfort of your own home. The opportunity cost of going to the store,wasting gas finding a movie is all too high, when you can just do it in the comfort of your own home. Netflix started in 1997 by co-founders Reed Hastings and Marc Randolph in Los Gatos, California.
The company started as a movie rental mail service then worked their way up. Around the year 2000, To help the business they had offered Blockbuster ,another rental movie service that was very successful at the time, to purchase Netflix for $50 million but was shot down. Now Netflix is a multimillion dollar company and continues to rise. Netflix has improved their company by using a recommendation algorithm by 10 percent, so viewers will be able to watch movies based on what they have watched before. The company’s expected subscriber growth is 9.4 million which is expected to exceed in the next couple of years. Netflix’s earnings are said to grow 33.47% through the years. Netflix has a lot of competitors many of them are Amazon, Hulu, HBO, Disney and even Youtube. In the future Netflix will be focusing more on their original content and adding more Tv-shows and movies to their company’s selection. Investors say that Netflix is a good company to invest in due to its good business. It is also said that Netflix will not experience a stock fall anytime soon. Netflix is a evolutionary company that has worked very hard to get where they are now and it shows in its overall success.